PRIVATE BUSINESS

London Local Authorities (Shopping Bags) Bill  (By O rder)

Order for Second Reading read.
	 To be read a Second time on Thursday 16 October.

Manchester City Council Bill  [Lords] (By Order)

Order read for resuming adjourned debate on Question [12 June], That the Bill be now read a Second time.
	 Debate to be resumed on Thursday 16 October.

Bournemouth Borough Council Bill  [Lords] (By Order)
	 — 
	Canterbury City Council Bill  (By Order)
	 — 
	Leeds City Council Bill  (By Order)
	 — 
	Nottingham City Council Bill  (By Order)
	 — 
	Reading Borough Council Bill  (By Order)

Orders for Second Reading read.
	 To be read a Second time on Thursday 16 October.

ORAL ANSWERS TO QUESTIONS

CHURCH COMMISSIONERS

The hon. Member for Middlesbrough, representing the Church Commissioners, was asked—

Stipendiary Pay

Anne McIntosh: When the Church Commissioners last met the Archbishop of Canterbury to discuss stipendiary pay for parish priests in rural areas.

Stuart Bell: I have not discussed the subject with the archbishop since June, when we had our annual meeting of the Church Commissioners, but I know that he, like me, would agree with the hon. Lady that parish churches and their congregations are at the heart of rural life. The national stipends benchmark is £21,600, although dioceses set their own policy on the application of national recommendations.

Anne McIntosh: I am most grateful to the hon. Gentleman for that answer. May I express my concern that rural parish vicars are being asked to spread themselves very thinly. As the hon. Gentleman has said, they go to the heart of rural life, but in the midst of the current rural crisis, is that having an impact on recruitment? What is he doing to ensure that we have sufficient parish priests to cope with all the parishes that require pastors?

Stuart Bell: I have sympathy with the points that the hon. Lady makes and with the difficulties that parish priests will have with the cost of living, as have the rest of our citizens at the moment. The policy on parish priests is set by the Archbishops Council, but the commissioners have a role in supporting the ministry. In 2007, we spent almost £178 million, including £105 million on pensions, nearly £33 million on parish mission and ministry support, nearly £25 million on bishops ministry and nearly £7 million on support for cathedrals. As the hon. Lady knows, apart from the stipend, the clergy remuneration package for parish priests in rural areas includes the provision of housing, the payment of council tax, water charges and maintenance costs, a non-contributory pension, removal grants and subsidised insurance in high-risk areas. The hon. Lady has made a valid point about how many more parish priests we can get in rural areas, and the Church will take it into account.

Robert Key: In addition to the question of stipends, will the Second Church Estates Commissioner tell us about the state of discussions between the Church Commissioners and Her Majesty's Revenue and Customs and the Treasury on the approved motor mileage allowance, which is tax free, because it seems to me that the clergy are currently subsidising their employers.

Stuart Bell: As usual, the hon. Gentleman has made a pertinent and adept point. I am not involved in the discussions between the commissioners and Revenue and Customs. I am happy to give the hon. Gentleman a response, and I will leave a copy in the Library.

Nigel Evans: I have never seen myself as a trade union leader for vicars, but on this occasion I am happy to do so, because I, too, believe that the parish church is the heart of rural life. Vicars have disappeared from certain areas in my constituency, which means that other vicars have had to double up or even treble up in order to cover those parishes. I hope that discussions will take place with the Archbishop of Canterbury to ensure that the pay package for priests is sufficiently attractive to allow all parishes to be covered.

Stuart Bell: As I said earlier, we think that parish priests are adequately covered in terms of finance, but it is true that churches in outlying villages are closed. When I go to my church in the north-east of England, it is always sad to find it closed. Stipends need to be flexible enough to allow the Church to put clergy where they are best deployed and consistent enough to avoid impeding mobility. Hon. Members have made important points today, which I will take back to the Church.

King James Bible

Tony Baldry: Whether the Church Commissioners plan to celebrate the 400th anniversary of the publication of the King James Bible in 2011.

Stuart Bell: The 2011 Trust has been established to celebrate that important anniversary through a series of lectures, exhibitions and concerts, culminating in a service of thanksgiving at Westminster abbey on 16 November 2011. I know that the commissioners and the House of Commons will wish the trust well in its work.

Tony Baldry: That is very good news. Of course, the King James Bible made the Bible accessible to every man and woman in the country. As the translator said,
	"there should be one more exact translation of the Holy Scriptures into the English tongue",
	so it really is good news that there will be celebrations in 2011. Perhaps, in these troubled times, it is worth recalling one phrase from the King James Bible:
	"The grass withereth, and the flower thereof falleth away: But the word of the Lord endureth for ever."

Stuart Bell: I am grateful to the hon. Gentleman for his remarks on the pertinence of the text. The authorised version of the Bible is one that we were all brought up on. I was personally saddened when the phrase
	"If I wash myself with snow water"
	was changed so that the new Bible read "with water". I thought that that was a sad difference between the two Bibles. When I have the opportunity to give a reading, I always use the old version rather than the new.
	The hon. Gentleman will know that the 2011 Trust is chaired by my right hon. Friend the Member for Birkenhead (Mr. Field). Its patron is His Royal Highness the Prince of Wales, and my friend the Dean of Westminster is a member. The trust was launched earlier this year in Poet's Corner in Westminster abbey, with speeches by the Bishop of London and Lord Bragg. You will wish to know, Mr. Speaker, as it is a very important point, that the Bible was written and translated in a room in Westminster abbey. It is a very august room; we had a meeting there with the Archbishop of Canterbury not long ago. Anyone who is interested in the history of that particular version of the Bible ought to pay a visit sometime; they will be very impressed.

David Taylor: The King James Bible owes much to William Tyndale's New Testament of 1526 and Thomas Cranmer's Book of Common Prayer of 1549—two of the greatest works in our national literature. They were fundamental in shaping the culture and philosophy of all English-speaking nations. Does my hon. Friend agree that without those books English would not be the predominant world language, with its amazing vitality, splendour and versatility, and that our Government should therefore fund a rather more substantial celebration in three years' time?

Stuart Bell: I am happy to take up my hon. Friend's point about the Government providing additional funding. As the pre-Budget report will be produced in two weeks' time, perhaps we can make a Budget submission on that point. My hon. Friend referred to 1526 and onwards, and the contribution that the authorised version made to our literature. That contribution is enormous, and may go on for ever. As for the future, he will be happy to know that the trust is busy commissioning new music and literature, developing educational school projects, publishing new texts, including a green Bible, and undertaking a host of other activities. It is working ecumenically and it will involve museums, galleries, libraries, the media, publishers and, of course, the Church, so the strands that began in 1526 continue to this day.

Patrick Cormack: If these particular splendid words are to endure for ever, would it not be a very good idea to ensure that every child attending a Church of England school is given a copy, not of a green Bible, but of the King James Bible, to commemorate the anniversary?

Stuart Bell: That is an interesting suggestion. May I divert the House briefly, Mr. Speaker? Mr. Randolph Churchill's mouth could never be kept closed, so, during the war, to keep him quiet for a while, he was bet a couple of crates of brandy that he could not read the authorised version of the Bible from cover to cover. Even Randolph Churchill failed in that task; he lost his bet. I would be happy for schoolchildren to have a copy of the authorised version, but I would not recommend that they tried to read it from cover to cover.

ELECTORAL COMMISSION COMMITTEE

The hon. Member for Gosport, representing the Speaker's Committee on the Electoral Commission, was asked—

Commonwealth Citizens

Philip Hollobone: What recent assessment the Electoral Commission has made of the effectiveness of the procedures for registering Commonwealth citizens on the electoral register.

Peter Viggers: The Electoral Commission informs me that it has issued guidance to electoral registration officers that includes advice on the registration of qualifying Commonwealth citizens. It has not, however, undertaken any specific assessment of the effectiveness of procedures for registering Commonwealth citizens on the electoral register.

Philip Hollobone: I thank my hon. Friend for that answer. I am worried that many Commonwealth citizens in this country without indefinite leave to remain may inadvertently be putting themselves on the electoral register because of a failure to understand the rules. I accessed the Electoral Commission website yesterday and downloaded a standard electoral registration form. The declaration at point 3 is that the person registering is a citizen of a Commonwealth country. That, however, is not sufficient for somebody to be eligible for the register. Will the Electoral Commission review the procedures for the form?

Peter Viggers: My hon. Friend is well known for being particularly assiduous and having a good eye for detail, and on this occasion he has put his finger on a specific and significant point. The "About my vote" website carries a marginal note that states:
	"You can register to vote if you are 16 years old or over and a British citizen or an Irish, qualifying Commonwealth or European Union citizen who is resident in the UK."
	However, yesterday I printed the application form to test it and saw that that marginal note is not repeated in the printed form. I could well understand someone printing out the form without the marginal note and entering on the register someone who was not qualified to vote. I have drawn the point to the Electoral Commission's attention. It is grateful for the point, and it will take up the issue and change the form. We are grateful to my hon. Friend.

Denis MacShane: I wonder whether you, Mr. Speaker, and the hon. Member for Gosport (Sir Peter Viggers) have read schedule 1 to the new Political Parties and Elections Bill, which relates to the Electoral Commission. Under the Bill, the Electoral Commission, on receipt of any allegation about any donation that it decides can thus be investigated, has extraordinary powers to order a break-in at any home of any candidate or agent for a council or parliamentary seat, and to order the removal of all that person's records. That will be an extraordinary interference in democratic politics and involve every single candidate, past and future, for council or parliamentary seats—and their agents and associates. The House has to consider that very seriously. Frankly, any letter of complaint to the Electoral Commission would mean that the home of everybody involved in politics could be ransacked on the pleasure of that obscure body.

Mr. Speaker: Order. Perhaps one day the right hon. Gentleman will speak to the core of the question. Supplementaries are always interesting, but not always relevant.

Fiona Mactaggart: I was wondering whether the attention of the Speaker's Committee on the Electoral Commission had been drawn to a certain episode in my constituency. An election court there has decided that the Conservative candidate in a recent election and his cohorts stuffed the electoral register with ineligible, and in some cases arguably non-existent, people—many of whom were Commonwealth citizens; that, Mr. Speaker, is how the episode connects to the original question.
	I remember vividly a Polish woman at the electoral court pointing out that five Pakistanis were not living in her one-bedroom flat. She said to the judge, "I might be Polish, but I am not stupid!" It struck me that it was important that we take action to prevent such ballot-stuffing—"roll-stuffing", the judge called it—from happening in other constituencies. Has the hon. Member for Gosport (Sir Peter Viggers) discussed that problem, and does he have a view on how we can prevent it from happening elsewhere?

Peter Viggers: Yes, indeed: since 2003 the Electoral Commission has taken the view—and expressed it forcefully—that individual registration would help to clarify and firm up the accuracy of the register and make it less likely that circumstances such as those in Slough that the hon. Lady has described will occur. That is the central thrust of the Electoral Commission's view on how we can improve the register in practice.

Simon Hughes: Does the hon. Gentleman realise that many people have concerns directly opposite to those of the hon. Member for Kettering (Mr. Hollobone)? There must be millions of eligible Commonwealth citizens in the United Kingdom. My experience of general and local elections—we have one of the latter in our borough today—is that I might find out when I knock on a door and discover a South African, Australian, New Zealander, Ugandan or whoever that they do not realise that they have the right to vote, although they have an absolute qualification without any argument. Will the hon. Gentleman consider whether we need a much better system for assessing how many people are in that category and for making sure that they know? Perhaps notices about people's entitlements could be given to them as they arrive and their passports are checked at immigration.

Peter Viggers: The Electoral Commission is running a campaign, which I think, without reference to the notes, is costing £300,000—some 4 per cent. of its budget—to encourage Commonwealth citizens who are eligible to vote in the United Kingdom but who have not yet registered to register.

Peter Bone: Listening to my hon. Friend the Member for Kettering (Mr. Hollobone) and the hon. Member for Slough (Fiona Mactaggart) one would think that there were far too many people on the electoral roll who should not be there. However, in my experience of delivering surveys in my constituency, one goes down a road where the electoral roll says that there are 100 houses, but there are 120 houses, so in fact a huge number of people are missing from the electoral roll. Has that issue been addressed?

Peter Viggers: Yes; a significant number of people are not registered who could be registered, and some are registered who should not be registered. The Electoral Commission has studied this in some detail over the years and has come back to the central view that the best way ahead is individual registration—removing the responsibility for registration from the head of household, who can make mistakes or not act, and putting responsibility on to individual voters.

SOLICITOR-GENERAL

The Solicitor-General was asked—

Domestic Violence

Graham Allen: What progress the Crown Prosecution Service has made in increasing the proportion of successful prosecutions in domestic violence cases.

Vera Baird: The proportion of successful prosecutions by the CPS in domestic violence cases has gone up from 55 per cent. in March 2005 to over 72 per cent. in June 2008, and the number of cases has gone up from about 35,000 to 63,000 over the same period.

Graham Allen: Will the Solicitor-General congratulate the CPS in Nottingham on working very closely with the crime and drugs partnership in promoting a scheme whereby the young people who witness domestic violence are treated as quickly as possible so that the trauma that they experience does not ultimately turn them into people who perpetuate domestic violence? This is often an inter-generational issue. Will the Attorney-General ensure that the CPS in Nottingham continues its excellent work to break that inter-generational cycle so that we do not have another generation of abusers and people perpetrating domestic violence coming along in future years?

Vera Baird: I assure my hon. Friend that not only my right hon. and learned Friend the Attorney-General but I will ensure that Nottingham CPS carries on the very good work that it is doing. In general, the CPS now has a very good model of community engagement. It is aware that, in order to get complaints that it can prosecute and to ensure that the effects that my hon. Friend describes can be tackled, it needs to work closely with the non-statutory sector. I read with great interest his recent piece of work on this; it is a very impressive piece in which he makes the point that he just made.

Maria Miller: The hon. Member for Nottingham, North (Mr. Allen) makes an important point about the effects that domestic violence can have on inter-generational issues. Is the Solicitor-General happy about how the courts take account when cases are taken to prosecution of the effect that domestic violence has on children in the home?

Vera Baird: The Crown Prosecution Service deals with prosecutions rather than with the impact on children, if there have been no offences against children. However, the problem is well known. Some model court procedures, most notably in Croydon, try to cross the boundaries between criminal cases and civil cases so that the impact on families can be taken into account and there can be no loss of information, for instance, between the civil and criminal courts from an unnecessary separation. The question was whether I am content. I would not say that I am content, but we are taking strong steps in the direction of ensuring that children's interests are as protected as they can be.

Serious Fraud

David Amess: What steps the Government plan to take to increase the effectiveness of their efforts in the detection and prosecution of people who have committed serious fraud; and if she will make a statement.

Vera Baird: The National Fraud Strategic Authority was established on 1 October as an executive agency of the Attorney-General's office. It will lead on the development and delivery of the UK's first national fraud strategy, which will co-ordinate the national effort to combat fraud. The Serious Fraud Office is developing stronger structures to enhance its ability to prosecute. Today, there is a very positive report from the CPS inspectorate about the fraud prosecution service in the CPS. It has an 85 per cent. conviction rate and very strong casework, and it is very highly regarded.

David Amess: Notwithstanding what the Solicitor-General has just said, following the departure at the start of the summer of director Robert Wardle, I understand that more than a third of senior management at the Serious Fraud Office have left. The general public know that a huge amount of public money has been spent on trials with no outcome at all. Is the Solicitor-General really happy with what is going on in her Department? Will she reassure everyone that the money being spent is well spent, and that the Government are serious in combating serious fraud?

Vera Baird: It would be very hard not to convince the public that we are serious in combating serious fraud, given that we have just done a review of it, and streamlined legislation dealing with offending. We have a new specialist unit in the Crown Prosecution Service since the failure over the Jubilee line case, and we have what I can only describe—quite contrary to the way in which the hon. Gentleman puts it—as a strengthened Serious Fraud Office. I had the opportunity to talk to its new director last night. He is moving the structures forward and he intends to put victims at the heart of his business, be they City companies or individuals. The proposal is that about a third of staff will investigate and prosecute company fraud, a third will attend to overseas corruption and bribery, and the final third will deal with the most serious and complex individual and commercial frauds. He is very confident that the changes he has made will be beneficial.

David Howarth: Another part of the picture on the effectiveness of efforts to deal with serious fraud is the SFO's reputation for independence and objectivity—a reputation that will be of immense importance in coming months because of the current financial turmoil, which is sure to lead to accusations of wrongdoing at some point. May I ask the Solicitor-General to reconsider the provisions in the Constitutional Renewal Bill that allow the situation to continue where there can be political interference in SFO investigations on the ground of national security, as defined solely by politicians? As we saw in the BAE case, national security is the politician's flexible friend.

Vera Baird: The hon. Gentleman, like some other Members in his party, simply never learns—going on and on and on about the BAE case. We are investigating BAE, with a view to prosecution, in a number of areas. I remind him of what the House of Lords said in its judgment about BAE. The decision that the director of the SFO, and no one else, took not to continue with the prosecution, which the hon. Gentleman simply cannot get off his mind—he must have it under his pillow every night—is that the director was not only "lawfully entitled" to make that decision, but that it could
	"be doubted whether a responsible decision-maker could, on the facts before the Director, have decided otherwise."
	Is it not time that the Liberal Democrats grew out of this?

Prostitution

Phyllis Starkey: What recent discussions she has had with Ministerial colleagues on the review of measures to reduce demand for prostitution.

Vera Baird: I have discussed with ministerial colleagues a number of measures to address the problem of prostitution, arising mostly from the review of demand that the Government have just completed. A number were announced by the Home Secretary in Manchester recently. They include: tightening legislation on kerb-crawling, new powers to close down brothels, greater restrictions on lap-dancing clubs and a new offence of paying for sex with someone who is controlled for another's gain. The full results of the review should be available later this autumn.

Phyllis Starkey: I welcome the fact that lap-dancing establishments are included within those considerations, because it seems to me that the boundary between prostitution, massage parlours, escort agencies and lap-dancing is pretty unclear, and all of them encourage an unhealthy objectification of women. May I ask the Solicitor-General to ensure that local authorities are well aware of the powers that they now have to license and regulate lap-dancing clubs, and that they act effectively to clean up this area?

Vera Baird: I fully echo all that my hon. Friend says about the objectification of women and the damaging assault on the bid for equality that sexual objectification makes. It is deplorable. Local authorities have powers but we intend to give them and local communities greater and better powers to control the opening and regulation of lap-dancing clubs. We will consult stakeholders about the best way forward. My hon. Friend the Member for City of Durham (Dr. Blackman-Woods) made some proposals in a recent Bill, but as soon as we have consulted stakeholders, we will pass the measures as quickly as we can.

Dominic Grieve: I welcome the Solicitor-General's comments on the review that the Government are carrying out, but she may also agree that supply and demand are intricately linked. In that context, the convictions for human trafficking—one of the major sources of supply for prostitution in this country—is not good: 232 arrests, but only 134 charges, and about 70 cases leading to conviction. Can the Solicitor-General help the House to understand where the problem lies? Is it in the prosecution process for securing the convictions or in the link between the Crown Prosecution Service and the police? Where are the difficulties and what can be done to tackle them?

Vera Baird: I take the hon. and learned Gentleman's point about the link between demand and supply. The number of prosecutions for trafficking offences is increasing exponentially, although I take his point about that. They have quadrupled since 2005 and he should recall that many sorts of offences are prosecuted—not necessarily only those under trafficking legislation—when a trafficking situation is found. They include false imprisonment, rape, kidnapping and threats to kill, and do not show up in the records as pure trafficking convictions.
	We are concentrating on demand because it is clear that 58 per cent. of the population would ban prostitution entirely and make it an offence, if they were satisfied—as I am—that it encourages trafficking. We will look closely at bringing into force deterrent legislation to try to cut demand.

WOMEN AND EQUALITY

The Minister for Women and Equality was asked—

Rape Crisis Centres

Maria Miller: What proportion of the £1 million emergency fund for rape crisis centres, announced in March, has been distributed.

Harriet Harman: The Government continue to step up action to tackle the menace of rape and bring offenders to justice. It is particularly important that we support victims of rape, and that is why we set up the special fund for rape crisis centres in March. Eight centres have applied so far and all received the full amount that they requested, totalling just over £175,000. We are doing a second round of grants: there have been 21 applications and decisions will be announced shortly.

Maria Miller: I thank the Minister for that reply. There has been much uncertainty about the funding of rape crisis centres since July and that does little to help them provide the service that rape victims deserve. What plans has the Minister for a more stable and long-term approach to funding rape crisis centres so that we can have more stability in that important service?

Harriet Harman: As I have just said, a further round of grants will be made to local rape crisis centres. That will help them as they apply for further finances locally. In addition, the Home Secretary has announced £1.6 million in funding for new and existing sexual assault referral centres. The new funding will go towards building 10 new sexual assault referral centres and providing additional resources for the 22 existing sexual assault referral centres. We want a SARC in every area. Also, the victims fund has given money to organisations that are members of the umbrella organisation, the Survivors Trust.
	I have asked the House to recognise that we have made progress. There has been a 45 per cent. increase in the number of men convicted of rape since 1997. That is the result of a combination of better support for victims, better support for witnesses in court, a change in the substantive law, specialist teams of expert, trained prosecutors and excellent police work. I pay tribute to all those who are involved in supporting victims of rape and bringing the perpetrators to justice.

Theresa May: May I begin by welcoming the hon. Member for Liverpool, Garston (Maria Eagle) to her new role in what I am sure she will find a very worthwhile area of work?
	The emergency fund for rape crisis centres was welcomed by all, yet seven months on, less than 20 per cent. of the fund has been distributed to front-line services, and centres are suffering as a result. The Minister has just referred to a further round of funding, but that may be too late for some centres. For example, funding for Barnsley's sexual abuse and rape crisis helpline ends this month, and without emergency funds the helpline might not be able to continue. It filled in all the paperwork at the beginning of September, but is still waiting for a decision. The emergency fund was supposed to provide reassurance for rape crisis centres, not add to their uncertainty, so will the right hon. and learned Lady ensure that the funding reaches those centres that urgently need it, to keep such vital services open?

Harriet Harman: We are of course determined to keep vital services open. That is why we set up the emergency fund, and I thank the right hon. Lady for her welcome for that. She will have noticed from my earlier comments that every single one of the rape crisis centres that applied to that fund was a given a grant of the full amount for which it applied. We have made absolutely sure that those who fear that the future of their rape crisis centre is in jeopardy have been invited to apply—indeed, all are invited to apply—and that they are able to receive full funding. There is more funding in the pipeline through the emergency fund, but there is also further support that comes from the victims fund set up by the Ministry of Justice.

David Howarth: Of course the £1 million of emergency funding was welcome, but my impression from talking to the rape crisis centre in Cambridge is that it understands the money to be purely short-term money, which does not help to stabilise the long-term position at all. Local rape crisis centres are being given the impression that for core funding they should look solely to local government, while central Government concentrate on the sexual assault referral centres. Does the right hon. and learned Lady accept that that is not very reassuring for local rape crisis centres? Such centres provide a service that is complementary to, but different from sexual assault referral centres: they concentrate on the victims' short, medium and long-term needs, whereas sexual assault referral centres, quite rightly, have at the centre of their concerns the criminal justice process.

Harriet Harman: The hon. Gentleman is absolutely right to say that we must ensure not only that we have the pioneering work on sexual assault carried out by the sexual assault referral centres, to which I pay tribute for developing and continuing such an important way of working, but that we have long-term counselling, which rape crisis centres add in to the support for victims of rape at the local level. There are a number of sources of finance for rape crisis centres, but because there was a problem earlier in the year, we set up the emergency fund.
	We have done a great deal over the past 11 years to recognise the problems in the criminal justice system for victims of rape. We have made changes in the substantive law and supported changes in the way the police, the Crown Prosecution Service and the judiciary work. I pay tribute to the work that my hon. and learned Friend the Solicitor-General has done in leading a review of the substantive law. We will leave no stone unturned in ensuring that we protect people from that crime and bring perpetrators to justice.

Equality Bill (Wales)

Julie Morgan: What recent discussions she has had with Welsh organisations about proposals for an equality Bill.

Maria Eagle: An event to launch the consultation on proposals for the equality Bill was held in Cardiff in June last year. There have been regular discussions between Government Equalities Office officials and their counterparts in the Wales Office and the Welsh Assembly. My predecessor, my hon. Friend the Member for Stevenage (Barbara Follett), wrote to the Welsh Assembly Government about the equality Bill in June, and in November there will be a meeting with Welsh organisations in Cardiff.

Julie Morgan: I thank my hon. Friend for that reply and welcome her warmly to her new post. I was pleased to visit the Women's Turnaround project in Cardiff with her in the summer. In her discussions about the equality Bill in Wales, will she ensure that she involves criminal justice organisations, so that issues relating to women victims and women offenders, such as the harsher sentences that women receive in the courts, can be discussed?

Maria Eagle: I begin by thanking my hon. Friend and the right hon. Member for Maidenhead (Mrs. May) for welcoming me. This is not quite the first time that I have worked on equalities issues as a Minister. I spent four years as Minister for disabled people and took the Disability Discrimination Act 2005 through the House, so I feel as though I am returning to an area in which I have worked before, to see what progress has been made and what more can be done.
	To answer my hon. Friend's substantive question, if we are to make progress, it is vital to involve the criminal justice agencies and the system as a whole in the equality Bill's provisions. The public sector duty for which the Bill will legislate will help in that respect. I hope that my joint responsibilities with the Ministry of Justice—I am still in charge of implementing the Corston agenda and ensuring that women are not disadvantaged by the way in which the system of criminal justice, particularly prisons and custody, applies to them—will also be helpful.

Hywel Williams: Will the Minister be meeting representatives of the Welsh Language Board, which has a particular function of promoting the equality of the Welsh language, and Alun Ffred Jones, the Welsh Assembly Minister who is currently preparing the legislative competence order on the Welsh language? That will have profound implications for the equality debate in Wales.

Maria Eagle: I am always happy to meet anyone who is interested in equality, even the hon. Gentleman, so I am happy to take up his suggestion. I must make the point, however, that language is not at present included as a protected characteristic in any EU or domestic discrimination law. I understand that some people think that it ought to be, but that would present significant policy implications. That is true not only of Welsh, of course; many other minority languages are spoken in Britain, including visual, gestural languages—the sign languages. Minority languages have some protection under the Council of Europe minority language charter, but sign languages do not. The hon. Gentleman is raising large policy issues, which I am of course happy to discuss further.

Equal Pay (Part-time Workers)

Linda Riordan: What recent steps have been taken to reduce the gap in pay between male and female part-time workers.

Maria Eagle: The most recent step was taken last week, when the national minimum wage was increased to £5.73 an hour, which is 60 per cent. higher than when it was introduced. Two thirds of beneficiaries of the national minimum wage are women, including many who work part time.

Linda Riordan: I thank my hon. Friend for her reply and congratulate the Government on consistently and successfully challenging discrimination and tackling the pay gap. However, while the pay gap experienced by women continues to narrow, its underlying causes persist. Will she therefore give a commitment that the Government will implement a widespread cultural change to tackle the undervaluation of women's work?

Maria Eagle: My hon. Friend is right to note the significant progress that has been made and to highlight the fact that it remains difficult to close the gender pay gap completely and to ensure that discrimination does not affect disabled people and black people, who are significantly disadvantaged in the labour market as a result of discrimination and in other ways. She is right to say that promoting cultural change is important, but it cannot be achieved overnight. However, that is the entire purpose of the new equality Bill, which will introduce a new equality duty, end age discrimination, require transparency, extend the scope for positive action, and strengthen enforcement. All those measures, which will be dealt with in the new Bill, will enable us to take a major step forward in closing the pay gap, and I hope that we will have my hon. Friend's support.

John Bercow: I, too, congratulate the hon. Lady on her appointment, and I wish her well in fulfilling her responsibilities. I applaud the efforts that are being made to tackle the gender pay gap, but note that the problem remains naggingly and infuriatingly persistent. Will she tell the House why the gender pay gap among part-time employees is worse in the public sector than in the private sector?

Maria Eagle: I am not convinced that what the hon. Gentleman has just said is correct—

John Bercow: It is.

Maria Eagle: I am not convinced that it is worse in the public sector. No doubt we can compare notes outside the Chamber and resume hostilities if what he says proves to be correct.
	Apart from the fact that many women are crowded into part-time occupations, which are generally lower paid, which accounts for the greater extent of the gap between part-time working, whether by men or women, and full-time male working, which is the biggest of the gender pay gaps, what the hon. Gentleman says illustrates the complexity of some of the issues. Not only discrimination, but work patterns and all sorts of other factors are involved. That is one reason why we have the national equality panel—a group of independent academics who are trying to help us to understand fully what we need to do to rid our society of those unacceptable gaps in pay based on gender.
	Obviously, the hon. Gentleman has a contribution to make and his record in the House in this respect is good. I look forward to working with him across the usual boundaries to try to make a real difference to our society as a whole.

Anne Begg: I add my welcome to those given to the Minister. Aberdeen has one of the widest gender pay gaps in the country, if not the widest. That is true of part-time and full-time work. How might the public procurement potential contained in the proposed equality Bill help to deal with that problem?

Maria Eagle: I can see why my hon. Friend is interested in the matter, given what she says about her constituency. She has highlighted an important lever that the public sector can use to lead by example. Every year, £160 billion-worth of contracts are let by the public sector, and some are let to the private sector. The equality duty will require, as the gender equality duty already requires, that goods and services are not distributed in a discriminatory fashion, so there is real potential to use public procurement to encourage the private sector to make much better progress in that respect. I hope that that is something we will look at.

LEADER OF THE HOUSE

The Leader of the House was asked—

Correspondence

Andrew Selous: What guidance is in place on acceptable response times for Ministers to reply to hon. Members' letters.

Chris Bryant: The Cabinet Office produces guidance for Departments on handling correspondence from Members of Parliament, Members of the House of Lords, Members of the European Parliament and Members of devolved Assemblies. All Departments should set targets, which should not exceed 20 working days. A copy of the guidance is in the Library of the House, and earlier this morning I placed a copy on the letter board for the hon. Gentleman.

Andrew Selous: First, let me welcome the hon. Gentleman to his new post. I am aware of the guidance and I have a copy of it. As he rightly says, the figure is 20 days, but I wrote to the Department of Health on 28 July on a serious matter with national implications for the treatment of NHS patients. Seventy-four days—10 and a half weeks—have passed and my office has chased the matter up 10 times to try to get a reply, but we have not had one. Will the hon. Gentleman help me to get a reply and will he remind all Ministers that replying to Members' letters is not just something that they should get round to, but a constitutional duty to perform out of respect for our constituents?

Chris Bryant: I am grateful for the hon. Gentleman's kind comment at the beginning of his remarks. What he describes is clearly not acceptable, and I shall ensure that he gets an answer as soon as possible. The guidance is extremely clear:
	"Departments must ensure that:
	(i) all replies to letters from MPs are of the highest quality—accurate, clear and helpful.
	(ii) every effort is made to reply promptly and in line with departments' own published standards for answering ministerial correspondence."
	While 204,925 letters a year are answered by Ministers, the Department of Health is one of the better-performing Departments, with 92 per cent. of letters responded to in time.

Paul Goodman: On 22 January, I wrote to the Department for Business, Enterprise and Regulatory Reform on behalf of my constituent, George Young. My office chased the letter up four times, and I finally received a reply on 8 September. I welcome the Minister to his new post, but will he encourage the Secretary of State for Business, Enterprise and Regulatory Reform to send one of his minions to the Dispatch Box to make a statement confirming that that delay and others like it are completely unacceptable, and that the Department will remove its collective finger from wherever it may happen to have inserted it?

Chris Bryant: The hon. Gentleman tempts me, but I will not go down that route. It is clear that hon. Members must have swift answers. Those who are elected to the House should get swift and substantive answers to the questions that they ask on their own behalf or on behalf of their constituents. Previous Leaders and Deputy Leaders of the House have made it absolutely clear that we intend to pursue this matter to ensure that Members get replies as swiftly as possible. That is as true for the Department that the hon. Gentleman mentioned as for any other. When there are pinch points, I would be grateful if hon. Members mentioned them to me so that we can sort them out and ensure that all hon. Members get swift replies.

Public Bill Committees (Evidence)

Michael Fabricant: What assessment she has made of the effectiveness of Public Bill Committees in taking oral and written evidence.

Chris Bryant: We have made an assessment of the effectiveness of the new system of Public Bill Committees taking oral and written evidence, which seems to be working well.

Michael Fabricant: I have pleasure in agreeing with the Minister, and I too congratulate him on his appointment. We have known each other for a long time—in the Culture, Media and Sport Committee on which we both served, I hasten to add. But does he accept that while the innovation is to be applauded and welcomed, it can only be acceptable if there is sufficient time to take evidence? Often, such Committees have insufficient time and the people whom Members want to interview are unavailable. What can we do to extend the amount of interview time?

Chris Bryant: I am grateful to the hon. Gentleman for his kind comments. I think that I speak on behalf of the whole House when I say that we are delighted that the Colombian police have released him so that he can be with us today.
	I accept the hon. Gentleman's point. The system is new. Clearly, it is considerably better that Committees are able to take written and oral evidence, and it is entirely up to Committees whether they choose to do so. In the past year, most Committees that have had the opportunity to take such evidence have done so if pre-legislative scrutiny has not already taken place. In the Health and Social Care Public Bill Committee, the hon. Member for Eddisbury (Mr. O'Brien) made it clear that he was extremely happy with the amount of time and the organisation of the witnesses provided. Likewise, in the Education and Skills Public Bill Committee, the hon. Member for Bognor Regis and Littlehampton (Mr. Gibb) was absolutely delighted with the consensus on the programme motion. Perhaps we need to consider some points, but I think that the system is working well.

Written Ministerial Replies

Mark Harper: What recent steps she has taken to encourage Ministers to provide timely substantive responses to questions for written answer.

Henry Bellingham: What steps she has taken to encourage Ministers to provide timely substantive responses to questions for written answer.

Chris Bryant: Successive Leaders and Deputy Leaders of the House have made it a priority to oversee the effective operation of the questions process and to ensure that Ministers and Departments are fully aware of their obligations to the House. Inquiries are made of particular Departments when problems are known to have arisen, or when hon. Members make representations. Most recently, steps have been taken to follow up the pattern of the answering of written questions tabled by the hon. Gentleman in July and September.

Mark Harper: I am grateful to the Deputy Leader of the House for that answer, and I too welcome him to his post. I acknowledge the work of the Leader of the House in chasing up Departments following my letter to her. Having said that, I am still waiting for answers to 17 questions tabled a week before the summer recess. Of the 85 named day questions that I tabled, 55 were not answered on the named day, and on average the answers were 19 days late. That is not acceptable. What will the hon. Gentleman and the right hon. and learned Lady do to ensure that Ministers deliver on their promises to the House?

Chris Bryant: My gratitude continues, this time to the hon. Gentleman for his kind comments. He has shown the House that he is an extremely assiduous Member, including during the recess. Many members of the public might think that Members of Parliament work only when the House is sitting, but he was assiduous in tabling questions even during the bank holiday week. During the three days in September, 807 questions were tabled. That is a good innovation, but it is clear that further work is necessary to ensure that a greater number of questions are answered more swiftly and substantively. As the hon. Gentleman has taken a long-standing interest in such issues, with two debates in Westminster Hall on ministerial accountability, I am happy to take forward some of those issues jointly with him.

Henry Bellingham: I too congratulate the hon. Gentleman. He has been an excellent Back Bencher hitherto, and I believe that he will be a friend to Back Benchers.
	I have had experiences similar to those of my hon. Friend the Member for Forest of Dean (Mr. Harper). Quite often in the past I have written to Ministers but have not received replies in time, so I now table more written parliamentary questions. It really is not satisfactory for the hon. Gentleman to say that he will examine the position and try to improve it; he must take action, because otherwise Back Benchers will continue to be let down by the Government.

Chris Bryant: I think I can do no better than to repeat the invitation that I issued earlier. I understand that there are pinch points in particular Departments, and I shall be happy to work with any hon. Members to ensure that they receive swift and substantive answers.
	The hon. Member for Forest of Dean described the Leader of the House as the policewoman in this context. If she is the policewoman, I am happy to be the community support officer.

Nigel Dodds: I too welcome the hon. Gentleman to his new post. Can he explain why two or three goes at a Department are so often needed for a Member to obtain an answer that could have been provided in the first instance? Can he also explain why certain Departments, particularly the Northern Ireland Office, are so reluctant to give details of meetings that Ministers have held with third parties? Although such information is widely promulgated in the press, Members of Parliament experience great difficulty in finding out directly from Departments what has been going on.

Chris Bryant: I will look into the second point that the hon. Gentleman raised. Perhaps if we have a conversation outside the Chamber, he could explain more fully the sort of issue that worries him.
	It is true that written parliamentary questions are an important part of holding the Government to account and of holding to account other organisations that are accountable to the Government. It is also true that the number of tabled written questions has risen dramatically, from 46 a day in the 1960s to 139 a day in the 1980s, and to 439 a day this year. I welcome that—I do not decry it—but obviously, as the hon. Gentleman has pointed out, if that is because Members have to ask the same question three times, Ministers may sometimes be making a rod for their own back. It would be better to sort the matter out promptly on the first occasion, rather than make Members return to it again and again.

Shailesh Vara: May I add my congratulations to the hon. Gentleman on his promotion? He will be the fourth Deputy Leader of the House with whom I have worked.
	Last year when Parliament prorogued, 263 written parliamentary questions remained unanswered, 23 of them for more than three months. Notwithstanding what the Deputy Leader of the House said earlier, will he or the Leader of the House undertake to prevail on their ministerial colleagues to ensure that this year they do not hide behind the veil of a prorogation, and that they give proper replies, even if the replies are inconvenient to the Government?

Chris Bryant: I do not think it is a question of convenience. The simple fact is that the Leader of the House and I are determined to deliver swift and substantive answers to hon. Members as soon as possible. However, I will look specifically into what happened before prorogation last year so that, as far as is humanly possible, we can ensure that it does not happen again.
	Incidentally, I remember going to one of the hon. Gentleman's local churches when I was youth chaplain for the Peterborough diocese. The hymn that was played was "One More Step Along the Road I Go".

HOUSE OF COMMONS COMMISSION

The hon. Member for North Devon, representing the House of Commons Commission, was asked—

Bottled Water

Linda Gilroy: How many bottles of House of Commons (a) sparkling and (b) still water were supplied for use by Committee members during meetings of Committees of the House in each of the last three years.

Nick Harvey: In 2007-08, some 10,000 bottles of sparkling water and 11,400 bottles of still water were supplied for use in Committee Rooms. That is broadly in line with the amounts supplied in the previous year, but an increase on the amounts supplied in the year before that. The Commission is well aware of the concern about the matter, and the Department of Facilities is exploring other options.

Linda Gilroy: I thank the hon. Gentleman for his response. He has good environmental credentials and he will know that bottled water can generate emissions up to 600 times greater than those from tap water. It is particularly embarrassing when representatives of the water industry attend meetings of the all-party parliamentary group on water. There is perfectly good water in our taps. May I encourage the hon. Gentleman to do all he can to make tap water available at our meetings, where the work can be very thirst-making?

Nick Harvey: The hon. Lady may know from previous exchanges on this matter that I have a lot sympathy with what she says. The Administration Committee looked at the issue in April and decided at that stage to make no change, but as I have mentioned, the Department of Facilities is looking at other options and this will provide another opportunity for the matter to be considered. I urge the hon. Lady and anyone of the same view to lobby the Administration Committee when the time comes for it to look into the matter again.

Andrew MacKay: Although I am pleased that the hon. Gentleman is sympathetic, it was several months ago when he said in response to a question from me that other options were being looked at. The wheels are turning very slowly on this serious matter. Out in the real world people are turning from bottled water for environmental reasons, but we do not seem to be able to do the same. Can we speed up the process?

Nick Harvey: I take the right hon. Gentleman's point, and I will do what I can to push the process along.

LEADER OF THE HOUSE

The Leader of the House was asked—

Ministerial Accountability

David Taylor: What recent discussions she has had on the means by which hon. Members can hold to account Secretaries of State who are not Members of the House of Commons; and if she will make a statement.

Harriet Harman: Secretaries of State are answerable to Members of the House in which they sit. Additionally, they respond to requests by Select Committees.

David Taylor: Unlike his Cabinet colleagues, the future Lord Mandelson will not be spending his weekends meeting constituents, undertaking casework and justifying policy to party members. In short, he has no mandate and will be directly accountable neither to the electorate nor to this House. To bridge that democratic deficit, does my right hon. and learned Friend the Leader of the House agree that he should be requested and required to attend departmental questions and to make ministerial statements from the green Benches of this place and not the purple settees of GMTV?

Harriet Harman: The Minister of State, Department for Business, Enterprise and Regulatory Reform, my hon. Friend the Member for Wolverhampton, South-East (Mr. McFadden), will be accountable for the Department's work in this House. The Secretary of State will be accountable for his Department's work to the House of Lords. No doubt, written and oral statements will be made where appropriate, and that Department will be fully accountable to both Houses for its work.

Patrick Cormack: Is the Leader of the House aware that many of us are entirely content that "Lord Guacamole" should answer in the other House?

Harriet Harman: I thank the hon. Gentleman for that point. He will, of course, be aware that accountability of all Ministers to the House in which they sit is important, but Cabinet appointments are not a matter for this House; they are a matter for the Prime Minister, as I know the hon. Gentleman understands.

Business of the House

Theresa May: May I ask the Leader of the House to give us the forthcoming business?

Harriet Harman: The business next week will be as follows:
	Monday 13 October—A general debate on promoting democracy and human rights.
	Tuesday 14 October—Second Reading of the Banking Bill.
	Wednesday 15 October—Consideration of a supplementary estimate relating to HM Treasury, followed by proceedings on the Consolidated Fund (Appropriation) (No. 3) Bill, followed by a general debate on local government delivering for local people.
	Thursday 16 October—Topical debate: subject to be announced, followed by a general debate on access to primary care.
	Friday 17 October—Private Members' Bills.
	The provisional business for the week commencing 20 October will include:
	Monday 20 October—Second Reading of the Political Parties and Elections Bill.
	Tuesday 21 October—Opposition Day [19th allotted day]. There will be a debate on an Opposition motion. Subject to be announced.
	Wednesday 22 October—Remaining stages of the Human Fertilisation and Embryology Bill [ Lords].
	Thursday 23 October—Topical debate: subject to be announced, followed by motion to take note of the outstanding reports of the Public Accounts Committee to which the Government have replied. Details will be given in the  Official Report.
	 The information is as follows:
	 That this House takes note of the 5th, the 8th, the 14th to the 29th, the 31st to the 35th, the 37th, the 38th, the 42nd and the 50th Reports and the 1st and 2nd Special Reports of the Committee of Public Accounts of Sessions 2007-08, and of the Treasury Minutes on these Reports (Cm 7366 and 7453).

Theresa May: I thank the Leader of the House for her business statement. All Conservative Members welcomed the Chancellor's statement yesterday, and both my right hon. Friend the Member for Witney (Mr. Cameron) and my hon. Friend the Member for Tatton (Mr. Osborne) have made clear our commitment to work with the Government through these difficult times. Next week, as she has just announced, we will debate the banking reform Bill, which includes changes to the powers of the Bank of England. Obviously, I welcome today's topical debate on financial stability, but the general public will rightly expect Parliament to spend more than an hour and a half debating the financial crisis. Will the Leader of the House therefore change next week's business to provide for a full debate on the financial crisis?
	One group of people particularly hard hit by the ups and downs of the stock markets are those who, at age 75, are obliged to take out an annuity. Given the current economic conditions, we think it important that people should have the freedom to choose to delay buying their annuity. My hon. Friend the shadow Secretary of State for Work and Pensions has today written to the Secretary of State for Work and Pensions asking him to put a temporary moratorium on this rule, and offering to work together on this. Can the Leader of the House confirm that the Government will indeed consider this, so that these people are not unduly penalised by circumstances completely out of their control?
	In recent days, our attention has obviously been focused on the financial markets, but there are problems lying ahead for everyone. The International Monetary Fund said yesterday that the world was entering a major downturn, with Europe and the US either already in, or on the brink of, recession. It predicts that the UK economy will contract by 0.1 per cent. next year. These conditions will of course require the Chancellor to revise his economic forecasts, which makes his autumn statement even more significant than usual. Will the Leader of the House therefore now give us the date for the Chancellor's pre-Budget Report?
	Earlier this week  The Times reported that the Government plan to drop their unpopular proposal to hold terror suspects for 42 days without charge because it is widely expected that the measure will be resoundingly defeated in the House of Lords next Monday. Can the Leader of the House confirm that the report in  The Times was accurate, or, if not, when we should expect to debate the measure again in this House?
	Finally, I turn to two, more parochial House points. I welcome the right hon. and learned Lady's written statement this morning extending the consultation period on her proposals regarding the audit and assurance of MPs' allowances—something that I suggested to her over the recess. Can she tell us how many responses she has received so far, and will she confirm that she will not hold any further such consultations over a recess? Can she also confirm that the chairmanship of Select Committees is a matter for the decision of those Committees? If so, will she explain why, over the recess, the hon. Member for Gloucester (Mr. Dhanda) was reportedly offered the chairmanship of the south-west regional committee—a committee that has not even been established by this House, let alone had decisions made on its membership? The right hon. and learned Lady has already suspended Standing Orders once to parachute in the Government's choice to the chairmanship of the Home Affairs Select Committee. Will she now guarantee this will not happen again, and that from now on she will stand up for the independence of Select Committees and the rights of this House?

Harriet Harman: The right hon. Lady is right in saying that the chairmanship of a Select Committee is a matter for the members of the relevant Committee.
	The consultation paper on the audit and assurance of Members' allowances was issued late on—at the end of July or even early August—and because the consultation was under way during the recess, and because a very small number of colleagues have responded, we have accepted the right hon. Lady's suggestion that we extend the consultation period. Work is already under way, following the resolutions of this House—including the abolition of the John Lewis list, among a number of measures—to improve the audit and assurance of Members' allowances, but further steps need consideration. We want the full involvement of Members in this, to make absolutely sure that they have the resources they need to do their work, and to ensure that the public have full confidence that public money is being properly spent.
	The right hon. Lady asked about the Counter-Terrorism Bill. She will be aware that, following debate and discussion in this House and the House having formed its view, the Bill is now under consideration in the House of Lords. Following their lordships' consideration of it, it will be dealt with in the usual way and will return to this House.
	The right hon. Lady asked whether I could give the House the date of the pre-Budget report. I will announce that in due course in the normal way. She also raised the issue of how this House makes sure that we have proper debates on the very important issue of the moment—the stability of the economy. As she said, the Chancellor made a statement yesterday; the Conservatives chose the economy as the subject of their Opposition day debate on Tuesday; and we have arranged a further debate in this House, to be led by the Financial Secretary to the Treasury this afternoon. We can all be clear that we agree on two things. First, when there is a matter of such national importance as this, it is right that the Government involve the Opposition and that we all work together on the issue. Secondly, if legislation is needed, consultation should take place, the terms of it should be respected and the House should be able to legislate on the matters promptly—that is very important. I know that all hon. Members will bear with us if we need to change the business of the House to accommodate important legislation on economic matters.
	We also all agree that there must be adequate time to debate these important issues, because this is not just a question of the problem in the financial services industry and the banking sector; these problems affect homebuyers, small businesses, depositors and those buying annuities, to whom the right hon. Lady referred, all of whom are at the top of our concerns. We want to ensure that these important issues are fully debated in this House and that Ministers are fully accountable to this House.

Simon Hughes: First, may I ask the Leader of the House to pass on our thanks to her colleague, the hon. Member for Bishop Auckland (Helen Goodman), for her helpfulness when she was Deputy Leader of the House, and to welcome her new Deputy Leader of the House to his position?
	In the spirit of co-operation in trying to maximise the opportunity for Parliament urgently to debate matters relating to the national and global financial crisis, which clearly are of huge concern outside this building, may I clarify one thing and ask two questions about the business that the Leader of the House has announced? She announced a debate next week on local government. We have read and heard reports that significant numbers of local councils had invested public money in Icelandic banks that have gone bust. I gather that the figure involved may be up to £500 million and that more than 20 local councils may be involved, as well as police authorities and transport authorities. Will she ensure, before the debate on Wednesday, that Ministers responsible for local government give an indication—it might be better if it were an indication, rather than a final view—of what the Government propose to do to assist local councils? Many councils are already cutting local services, including social services, and, whatever their party affiliation, they want to ensure that further cuts do not have to be made as a result of the present crisis.
	Secondly, the Leader of the House rightly mentioned the concerns of small business about the present financial position. Small business organisations have made it clear that they are still receiving letters from banks offering loans at rates of 15 per cent. The majority of the British work force works in small businesses, rather than in big businesses, so can she see whether we can have a debate in this place with the new team at the Department for Business, Enterprise and Regulatory Reform—with or without the Secretary of State—on what can be done to ensure that huge numbers of small businesses do not go under in the days immediately following the events of the past two weeks?
	Thirdly, the Leader of the House knows as well as I do that in boroughs such as ours, and probably in every local authority in the country, affordable housing is one of the most urgent needs. Local authorities and housing associations will clearly be in greater difficulty borrowing money to build the programmes to which they have already committed themselves or that they wanted to build. May we have a debate on how to ensure that the plans of the Government, of London government, of London councils and of all local authorities can be implemented, because loads of people are desperately waiting for the housing that they need?
	Lastly, on an in-House matter, I persistently asked before the summer that we ensure that we have time on Report on Government Bills to debate Opposition and Government Back Bencher amendments and new clauses. We know of six Government Bills that are in the pipeline between now and the end of term, including the Human Fertilisation and Embryology Bill. Given that, even yesterday, some amendments and new clauses could not be debated for lack of time—such as the important issue of whether smacking should be allowed—can we please ensure that Parliament can do its job properly and debate the issues that colleagues from all parties put on the agenda, instead of having debate closed down by Government guillotines?

Harriet Harman: I thank the hon. Gentleman for his comments in appreciation of the excellent work of the former Deputy Leader of the House, my hon. Friend the Member for Bishop Auckland (Helen Goodman), and I pay tribute to her. I also join hon. Members in welcoming her excellent successor, my hon. Friend the Member for Rhondda (Chris Bryant).
	It is important for the hon. Gentleman to remember that the resources that have been going into local government from central Government have increased year on year. He is right to say that local government services are very important, and we want to ensure that they are protected. There will be an opportunity for hon. Members to ask the Financial Secretary to the Treasury questions about local government deposits this afternoon in the topical debate.
	The hon. Gentleman mentions the important issue of the effect of the financial and banking crisis on the work of small businesses. We all agree that small businesses are critical to the economy and to employment prospects, and they need an effective banking system to survive and prosper. It is important that work is undertaken at European level, through the European Investment Bank; at national level, through the actions of the Treasury and other Departments; and at regional level. Small businesses are the focus of the Government's concern, and we will take all steps necessary to ensure that they can continue their important work.
	The hon. Gentleman also mentioned the Human Fertilisation and Embryology Bill. I remind the House that we have already had 81 hours of debate across the two Houses on that Bill, so we have sought to make adequate time available to debate that important issue. Additionally, there have been two full days of debate on the Floor of the House, followed by a free vote on those issues of conscience. When the Bill comes back to this House, we will have further opportunity for debate.
	The hon. Gentleman raised an important point about housing. The plans are important not only to increase the supply of housing, but because they touch on the question of public sector investment in infrastructure, whether in transport, industry, housing or even people's skills. The Government have two obligations. First, we must see the country through this immediate crisis, ensuring that we give most support to those who are most directly affected and those who are most vulnerable. Secondly, we must not do anything to undermine the strengthening of the economy in the future. The forecast is that, once we have got through the present difficult circumstances, the economy has bright prospects for the future. For that reason, we do not want to cut infrastructure projects that need further investment, and that is why the Chancellor has announced that he believes that it is sensible to allow borrowing to rise to find our way through the crisis and to sustain investment for the future.

Several hon. Members: rose —

Mr. Deputy Speaker: Order. I seek the co-operation of hon. Members. There is heavy demand to participate in the two time-limited debates that follow business questions. I cannot promise to call every hon. Member who wishes to put a question to the Leader of the House, but we will make more progress if we have one question per Member, especially if it relates to next week's business. I am sure that the Leader of the House will also give as concise answers as she can.

Parmjit Dhanda: First, may I say to the right hon. Member for Maidenhead (Mrs. May) that she should not believe everything she reads in the papers? I, too, express my good wishes to my hon. Friend the Member for Rhondda (Chris Bryant) on his appointment, which is richly deserved.
	May I tell my right hon. and learned Friend the Leader of the House that I am pleased to see how much time is being allocated to discuss the financial crisis? She will be well aware that Labour Members and Opposition Members are particularly concerned about the important merger between HBOS and Lloyds TSB. A lot of concern has already been expressed by Front and Back Benchers about jobs in Yorkshire and in Scotland. May I add to that my concern—

Mr. Deputy Speaker: Order. I did ask for brief questions and the hon. Gentleman has done pretty well. I heard three, if not four, points there.

Harriet Harman: I thank my hon. Friend for his question and I know that he is assiduous in his attention to his constituents—those whose jobs are affected by the crisis, depositors who are concerned about whether their deposits will be assured, and shareholders. I know that he will continue to play an important part in future debates and we will ensure that those debates are available to the House.

George Young: Last year, the pre-Budget report was published on 9 October—today's date. It is disappointing that the Leader of the House was unable to give any indication of when it might be published this year. Last year, inexcusably, the Government gave the House no time whatsoever to debate the pre-Budget report. In view of its importance this year, will the Leader of the House guarantee time to debate it?

Harriet Harman: Consideration has been given to how we allocate days for debate following the Queen's Speech and the Budget and, as the right hon. Gentleman said, to the opportunities for a full-day debate following the pre-Budget report. He will find that there will be ample time to debate all the issues and I shall make the announcement about the date of the pre-Budget report in the normal way.

Chris Mullin: Given all that went on during the summer recess—the war between Russia and Georgia and the crisis in the global financial markets—will my right hon. and learned Friend consider bringing Parliament back for two weeks in September on a permanent basis, as we once agreed to do? We quietly reneged on that agreement when the public attention was off us. Would that not enhance the esteem in which we are held, as well as the democratic process?

Harriet Harman: My hon. Friend is consistent—I will say that—in raising that point. The Chancellor has made a statement on the financial markets since the House returned. My hon. Friend will know that next Monday, as I just have announced, there will be an opportunity, led by my right hon. Friend the Minister for Europe, to debate democracy and human rights. It will be an opportunity for Members to debate the things that have happened in Georgia over the summer.

Douglas Hogg: Does the right hon. and learned Lady agree that one of the historic and most important functions of this House is to control supply? That being so, will she ensure that yesterday's proposals are enshrined either in primary legislation or, alternatively, in amendable resolutions of this House, so that we can change them if we do not agree or reject them if we think that they are entirely wrong?

Harriet Harman: When the Government seek to take action that requires primary legislation, we will come before the House. If secondary legislation is required, there are procedures for that. If action does not require either secondary or primary legislation, the information will be given to the House by way of written or oral statements or will be supplied in debates. There will be an opportunity for the House to hold Ministers to account for all the actions that they take.

Anne Begg: In the summer recess, two schoolchildren in Aberdeenshire were killed when they got off their school bus. The Yellow School Bus Commission, which was chaired by my right hon. Friend the Member for Sheffield, Brightside (Mr. Blunkett), also published its report. The commission took evidence in Aberdeen from Robert Gordon's school, which uses yellow buses. I understand that the right hon. Member for Gordon (Malcolm Bruce) hopes to table a Bill later in the Session that will address some of the issues to do with school bus safety and the safety of our children travelling to and from school. Will my right hon. and learned Friend guarantee that she will give that Bill clear passage?

Harriet Harman: I express my condolences to the families mentioned by my hon. Friend. I also congratulate my right hon. Friend the Member for Sheffield, Brightside (Mr. Blunkett) on his work on the Yellow School Bus Commission. These are important issues that affect congestion as well as safety, pollution and the affordability of school travel, and I will ensure that we take into account the points that my hon. Friend raises.

Henry Bellingham: Is the Leader of the House aware that during this time of acute crisis in the banking sector, more of our constituents are moving deposits into the Post Office and into National Savings accounts? Surely, now is not the time for the Department for Work and Pensions even to consider getting rid of the Post Office card account. Will the right hon. and learned Lady guarantee today that in these tumultuous times the Post Office card account will be kept in place?

Harriet Harman: As I have told the House on previous occasions, there is a procurement process and the contract, pursuant to the normal rules, is under consideration. No decision has been announced as yet.

Phyllis Starkey: Will the Leader of the House consider making room for a debate on an issue of great importance to rail travellers in Milton Keynes? London Midland appears to have taken the opportunity of "fare simplification" to increase off-peak fares by about 10 per cent. At a time when we should be encouraging people to use rail rather than the roads, that seems highly unfortunate and worthy of a debate in this House.

Harriet Harman: I shall take that as a useful suggestion for a topical debate. Perhaps we could discuss investment in rail as well as fare prices for passengers and freight.

Andrew MacKay: With the best will in the world, surely the Leader of the House must realise that the public will think that it is totally inadequate that on most days next week we will not be discussing the economic crisis. With the problems of pensions and annuities already mentioned by my right hon. Friend the Member for Maidenhead (Mrs. May), will the Leader of the House at least assure us that she will keep matters under review and will return early next week to change the business so that we look relevant to the public? Otherwise, it will do huge damage to this House.

Harriet Harman: We will debate matters touching on the economy on Tuesday and Wednesday next week, but the right hon. Gentleman does not need to wait that long. He need wait only until the end of this business, when he can raise issues in the topical debate. I assure the House that as well as ensuring that the Government's general business gets through we will bend over backwards to ensure that the House has the opportunity to debate the very important economic issues.

Ian Cawsey: Earlier this week, an independent report commissioned by local councillors in my area showed that the economic impact of tolls on the Humber bridge was costing the region more than £1 billion in economic activity. Given the difficulties that we are facing in our local economies, could the subject of next week's topical debate be Government initiatives that could help economic growth in areas across the whole country? Will my right hon. and learned Friend ensure that Humber bridge tolls are part of such a debate?

Harriet Harman: I will consider my hon. Friend's request for a topical debate. I will also bring his point to the attention of the new Secretary of State for Transport.

Paul Burstow: My local authority, on a cross-party basis, is very concerned about the fate of the £5.5 million that it had deposited with a subsidiary of Landsbanki and wants to know when it will hear in the House a debate that will ensure that we can get the reassurances from Treasury Ministers that have been offered to retail depositors. There is a concern on behalf of council tax payers that the money invested in line with guidelines set by the Treasury will be lost and that as a consequence council tax will rise.

Harriet Harman: As I said to other hon. Members, there will be an opportunity to raise such questions with the Financial Secretary at the end of business questions.

David Taylor: Can we find time next week for a debate on parliamentary protocol, in particular on the importance of respecting confidentiality when a bipartisan approach to a national crisis leads to off-the-record briefings by senior Opposition politicians? It was a little unseemly to see the shadow Chancellor haring round TV studios last weekend, sharing with the nation the thoughts of the Governor of the Bank of England, his new best friend.

Harriet Harman: My hon. Friend makes a very important point. He reinforces the point that I made at the outset about the importance of the Government's acting decisively but, wherever possible, on a bipartisan basis. The markets are sensitive to debate and discussion and things that are said can affect people's living standards by affecting share prices and confidence, so it is very important that when any confidential discussions are entered into, that confidentiality is respected.

Peter Bone: Was the Leader of the House surprised that Parliament was not recalled from recess, when we face the worst economic crisis for 100 years and are going from boom to bust? Is it not a good idea to amend Standing Order No. 13 to ensure that it is up to the Speaker whether the House is recalled in future?

Harriet Harman: As the hon. Gentleman knows, the Prime Minister raised the question of the call and recall of Parliament in "The Governance of Britain", which the Modernisation Committee is due to consider shortly.

Siobhain McDonagh: In June, Michelle and six-year-old Jayden had their gas cut off by Scottish Power, leaving them without cooking, heating and lighting for more than four months. Scottish Power is owned by a company that made a profit of €200 million last year, and it wants my constituent to pay £350 for extra pipe work to install a rip-off pre-charge meter. Can we have a debate in the near future to examine the social responsibility of utilities such as Scottish Power to help people such as Michelle across the country?

Harriet Harman: That is an important and timely suggestion for a topical debate, and no doubt it will attract the support of many hon. Members. As the Prime Minister said yesterday at Prime Minister's questions, we must ensure that the energy companies operate fairly in respect of hard-pressed consumers at this difficult time.

Patrick Cormack: Will the Leader of the House promise not to waste the time of the House by providing an opportunity to debate the ridiculous, absurd and unsustainable proposition that we should have regional Select Committees?

Harriet Harman: I do not agree with the hon. Gentleman. When one thinks of the effect of the current economic climate on businesses big and small, one sees that the work of regional development agencies and of strategic regional authorities is even more important. The fact that such bodies are not properly accountable to Members of this House needs to be acted on. When the Modernisation Committee conducted an inquiry on regional Committees, there was not agreement in Committee on how they should be established, but there was full agreement that there is a need for this House better to hold to account such agencies, which are very important at the regional level. We will proceed in due course, and the hon. Gentleman will have a chance to join the debate and vote on the matter.

David Chaytor: The Child Support Agency has required one of my constituents to pay several thousand pounds of arrears in 12 months. My constituent does not dispute the arrears, which he wants to pay, and he is currently looking after the children for whom the arrears were incurred. Can we debate the way in which the CSA deals with arrears at this time of economic slowdown? My concern is that those who want to face up to their responsibilities will be penalised by an excessively stringent approach to arrears as the economy slows further, while those who want to avoid their arrears will continue to do so.

Harriet Harman: My hon. Friend makes an important point. First and foremost, we should examine the issue from the viewpoint of the children. It is right to expect fathers who can do so to pay a fair proportion of their income to their own children. It is therefore best if people do not get into arrears in the first place. Perhaps I can ask him to seek a meeting with the Secretary of State for Work and Pensions in respect of his individual constituent.

Nigel Dodds: The remaining stages of the Human Fertilisation and Embryology Bill are due to be taken on 22 October. Will the Leader of the House accept that that Bill is a highly inappropriate vehicle to impose a fundamental change in relation to the law on abortion in Northern Ireland? Given that the communities and all parties in Northern Ireland are united on the issue, if devolution is to mean anything, the wishes of the people of Northern Ireland should be respected in that regard.

Harriet Harman: Obviously it is very important that the question of the view of the parties in Northern Ireland is taken into account, irrespective of the issue that is being raised. It is also important that the views of men and women are taken into account in all parts of the United Kingdom when services are being considered. As the hon. Gentleman said, the Human Fertilisation and Embryology Bill will come before the House next week, and no doubt he will be able to make his points in the debate.

Jim Sheridan: Can we have a debate on the long-term future of regional airports? My right hon. and learned Friend may be aware of the recent decision by British Airways to relocate its cabin crew staff from Glasgow airport and other regional airports throughout the UK, which has resulted in significant job losses. Does she agree that British Airways is hardly an appropriate brand name, when it sees regional airports as trading posts? It is happy to take the natives' money, but it will not trust the natives on its aircraft.

Harriet Harman: I will raise that important point, which is also the subject of my hon. Friend's early-day motion 2208 on British Airways job losses at Glasgow airport.
	 [That this House expresses its concern at the continuing loss of jobs by British Airways staff at Glasgow Airport and other regional airports across the UK; notes that these job losses demonstrate a clear lack of commitment by BA to serving regional airports outside London, is not in the best interests of the travelling public, undermines the long-term security of the workforce and treats regional airports such as Glasgow as trading posts; and believes that British Airways should reconsider this decision or go the whole way and rebrand themselves London Airways.]
	I will raise those important points with the Secretary of State for Transport, the Secretary of State for Business, Enterprise and Regulatory Reform and the Secretary of State for Scotland.

Michael Penning: The people of Hertfordshire will be surprised by the Leader of the House's decision not to call for a statement on local government finance problems due to banks crashing in Iceland. In Hertfordshire, £17 million is invested in those banks. That investment was made in good faith and at the Government's request, because the assets were being held. That will cause a shortfall in cash flow as well as a shortfall in next year's funding, because the interest was required to go forward. Can we have an immediate statement on how local government will survive in that situation?

Harriet Harman: I have put next week's business before the House. We arranged for this week a debate on financial stability, which will take place shortly. As well as having the opportunity to speak in that debate, Members will be able to ask the Minister questions during his speech.

Brian Iddon: There is a requirement for utility companies to provide their customers with at least one bill every two years. Here in London my electricity provider does that, but Powergen, my electricity supplier in Bolton, rarely provides me with a bill. As a result, Powergen got me in debt to the tune of £1,000 last year. It read my meter two months ago, but no bill has followed, and several of my constituents are in debt as a result of such terrible behaviour by several power companies. I echo the request for a topical debate on the behaviour of the providers of power to our homes, which could extend to the provision of social tariffs, smart meters and feed-in tariffs.

Harriet Harman: My hon. Friend makes an important point. Without pre-empting myself or anybody else with whom I might discuss the issue, I think that the question of how energy companies are operating in this difficult situation is a front-runner for next week's topical debate.

John Bercow: Notwithstanding what the Leader of the House has already said, may I appeal to her spirit of generosity and urge her to announce in a statement next week that there will in fact be two days, not one day, for the remaining stages of the Human Fertilisation and Embryology Bill, both because that is right in itself in view of the array of opinions on the subject and, indeed, because it would represent a display of strength and receptiveness on the part of the Government?

Harriet Harman: I was just looking for information about the amount of debate that there has already been. In considering whether there will be enough debate, the House should recognise how much debate has already taken place on the Human Fertilisation and Embryology Bill. In total, the Bill has been debated on the Floor of both Houses for 81 hours, with 10 sessions in the Lords and, so far, seven in the Commons. We have already had two days on the Floor of the House discussing amendments and new clauses on the basis of free votes on conscience issues. I stand second to no one in believing that the House should debate these heartfelt issues properly, but taking a view across all the business coming through this House, I think that 81 hours probably amounts to adequate debate.

Fiona Mactaggart: Will my right hon. and learned Friend take an early opportunity to correct a false impression created by a question asked earlier today by the hon. Member for Kettering (Mr. Hollobone)? The question implied that Commonwealth citizens resident in Britain who have limited leave to remain, such as the wives of British citizens, are not eligible to vote in elections, but they are.

Harriet Harman: I think that my hon. Friend has taken this opportunity to correct the record, but perhaps I will ask the Home Secretary to write to the hon. Member for Kettering and put him straight.

Hywel Williams: May we have a debate on the tagging system for prisoners who are on early release, and on the inefficiency and incompetence in a particular case in which a young man in my constituency was returned to prison for an extra three months through no fault of his own? Perhaps a debate could be held in Westminster Hall.

Harriet Harman: The hon. Gentleman refers to the important issue of recall to prison for those released on licence who are subject to conditions in respect of their tag. I know that that is a very controversial issue, because obviously recall to prison is a drastic step. I suggest that, in the first instance, he raise the question with the Home Secretary.

Barry Gardiner: My right hon. and learned Friend will be aware that a number of Members on both sides of the House have written to express their concern about the deterioration of the situation in Sri Lanka, and about the Sri Lankan Government's bombing of areas in the north and east of the country. I appreciate that there is a debate next week on human rights, but most Members who have written feel that that would be inadequate to deal with the subject, and that a special debate should be called for.

Harriet Harman: I will take my hon. Friend's proposal as a suggestion for a topical debate, but as he anticipated, I think that there will be an opportunity to discuss the important issues relating to Sri Lanka next Monday. I know that he is very concerned about his constituents who have families in Sri Lanka, and he is assiduous in his concern for their welfare and the welfare of their relatives. However, I suggest that he try to catch the Speaker's eye in the debate on Monday.

Mark Harper: Yesterday, amidst all the financial turmoil in the markets, the Government still found time to whip their MPs—and, in a break with usual practice, even members of the Government—to ensure that they voted against my ten-minute Bill in favour of openness and transparency in the making of law. Given that, will the Leader of the House find time for a debate in the House on openness and transparency, so that we can establish once and for all whether the Government are actually in favour of it?

Harriet Harman: It was this Government who introduced the Freedom of Information Act 2000, and we want to make sure that debate is full and fully informed. We will continue to be as open as possible.

Jim Devine: It is nearly two years since the collapse of the Farepak Christmas saving scheme. May we have a debate in Government time on the inquiry that was set up last year? It was due to report first at Christmas, then Easter, and then before the recess, but did not do so. Tens of thousands of decent, hard-working families deserve to know what happened to their money. Margaret Rettie in my constituency paid hundreds of pounds at 20 past 3 on the day on which the company collapsed; it did so at a quarter past 4. People like her deserve answers.

Harriet Harman: The whole House will have every sympathy with my hon. Friend's point. We are all well aware that the people who lost money to Farepak were those who could least afford to do so. The fact that they are still waiting for the report is not acceptable. I thank him for raising the issue, as he has done consistently. We really do need to get the matter sorted out. I will work with the Deputy Leader of the House to make sure that we get some answers fast.

Alistair Carmichael: May we have an early statement or debate on the changes proposed by Her Majesty's Revenue and Customs to the seafarers' earnings deduction scheme? The change will affect people throughout the merchant navy, but it will have a particularly severe impact on those working in the North sea in the offshore oil and gas sector because of the proposals to backdate the changes. It is an issue on which Parliament really ought to have a voice.

Harriet Harman: I understand that my right hon. Friend the Financial Secretary to the Treasury, who has just joined us in the Chamber, is looking into the issue, so perhaps in the first instance the hon. Gentleman might seek a meeting with him to discuss how far my right hon. Friend has got in progressing the matter.

Tony Baldry: Will the right hon. and learned Lady arrange for the Secretary of State for Communities and Local Government to come to the House next week to make a statement on local government finance? The problem is not just the fact that local authorities have money frozen in Icelandic banks—in Oxfordshire, some £28 million-plus has been frozen or perhaps lost. There is another issue: many local authorities, in the course of their business, work with cash surpluses that they have to deposit. They need guidance from the Department for Communities and Local Government on what is acceptable practice, so that they can ensure that the money is protected. They would like to invest it in UK banks—they do not want to hold it themselves—but they want some safeguards and protection. It is a matter for the Department for Communities and Local Government—

Mr. Deputy Speaker: Order. I think that the hon. Gentleman has got his point across.

Harriet Harman: In addition to the opportunity presented by the debate that follows this business statement, there will be a general debate next Wednesday on local government delivering for local people. All the hon. Gentleman's points can be raised and answered by Ministers in that debate.

Anne McIntosh: Thousands of holidaymakers across the country were recently left stranded, distressed and hugely out of pocket, through no fault of their own, as a result of a number of failures on the part of airlines. In 2004 and 2006, the Select Committee on Transport made a request, which the Civil Aviation Authority supported, that an airline levy be charged covering all passengers, particularly those who book their accommodation independently. Will the Leader of the House allow a debate—possibly a topical debate—next week or the week after to enable all of us who represent those passengers to debate the issue? We could debate the review of the European package travel directive at the same time.

Harriet Harman: I will raise the points that the hon. Lady has brought before the House with the new Secretary of State for Transport. We were all appalled to see what happened to those who were left stranded around the world. The Foreign and Commonwealth Office's consular offices across the world did what they could. Many people were eligible for compensation, but some who booked online, or independently, were not.

Mark Pritchard: May we have an urgent debate on the future of general practitioner services? Why are the Government intent on removing the dispensing powers and services of GPs, particularly in rural areas? That will leave patients in my constituency having to travel far further to collect their medicines. Will the Government have a rethink about this?

Harriet Harman: There will be a general debate on access to primary care next Thursday. I suggest that the hon. Gentleman catch the Speaker's eye in that debate and raise his constituents' concerns then. However, I remind him and the House that there has been unprecedented investment in, and improvement to, primary care services since this Government came to power and made the NHS a priority.  [Interruption.] I hear Opposition Members say that that has been wasted. Before we came to power, many of my constituents could not even get on a GP's list, because the lists were closed. When they managed to appeal and did get on a GP's list, they sometimes found that they had to wait weeks for an appointment, and when they did get to see the GP, it was often a locum who was completely knackered. GP services have been substantially improved.

Several hon. Members: rose —

Mr. Deputy Speaker: Order. I hope that the Leader of the House will help me to ensure that colleagues who have not yet asked a question get to speak.

Mark Lancaster: May we have a debate on the performance of the UK Border Agency? A constituent of mine who has been asked to sponsor someone from Sierra Leone has been told that he must send details of all his bank accounts and savings to Sierra Leone, so that the applicant can give them to the embassy there. Why does he have to send all his bank details abroad? Why could he not take them to someone in the UK? It is a ludicrous policy.

Harriet Harman: When processing visas for entry to this country, those concerned need to be able to look at as much information as they regard necessary in each individual case. I suggest that the hon. Gentleman raise that point in writing with the Home Secretary.

James Brokenshire: My local authority, the London borough of Havering, is one of the councils that has had its accounts with an Icelandic bank frozen. I heard what the Leader of the House said about the opportunities presented by the topical debate, but she will appreciate that the ability to ask questions on this specific issue will be limited. As for waiting until next Wednesday, as we see, a lot of things could happen before then. In light of comments made by a number of hon. Members, will she reconsider speaking to Ministers in the Department for Communities and Local Government, and will she encourage them to make an urgent statement on the issue on Monday, to allow detailed questioning on it?

Harriet Harman: Things are getting a bit surreal: hon. Members are taking up time in asking me to find time, but I am telling them that they can put their questions to the Financial Secretary to the Treasury, who is here. I understand that he will report on meetings with the Local Government Association, so instead of asking me, why do those hon. Members not just ask him?

Philip Hollobone: Residents in Kettering have been waiting ages for a long overdue announcement from the Department for Transport and the Highways Agency about the Government's plans to expand the A14 around Kettering. Will the Leader of the House be kind enough to urge the Department for Transport to make a statement in the House on the issue next week?

Harriet Harman: I shall raise the hon. Gentleman's point with my right hon. Friend the new Secretary of State for Transport.

Julia Goldsworthy: May we have a debate on the administration of the education maintenance allowance system? I have been contacted by a number of young people in my constituency who should have qualified automatically for the allowance, but have waited more than eight weeks for it to be processed. I am concerned that a number of other people across the country might be affected in a similar way. I would appreciate the opportunity for a debate with the Minister.

Harriet Harman: My right hon. Friend the Secretary of State for Children, Schools and Families has already devoted a great deal of attention to that issue. The hon. Lady is right: those who are awarded the education maintenance allowance need it promptly. I shall raise her points with my right hon. Friend and see whether there can be a further written statement or other process to make sure that he is fully accountable to the House on that important issue.

Philip Davies: When time allows, may we have a debate about the Black Police Association, a divisive organisation that is stirring up racial tensions? If there were a white police association, the Leader of the House would be first in line to be outraged about it. I cannot see the legal or moral difference between a white police association and a black one. May we have a debate on the issue? Like many other people in the country, I think that the association should be scrapped.

Harriet Harman: It is very important that the Metropolitan police should command the confidence of the diverse communities in London whose security it is there to protect and whose co-operation it needs to investigate crime and prevent it from happening. Historically, black and Asian people have been under-represented in the Metropolitan police, but a great deal has been done to increase its black and Asian members. Much of that has been due to Sir Ian Blair; I pay tribute to the fact that he has made sure that more black and Asian people have been recruited to the police to ensure full public confidence.
	As the hon. Gentleman may know, the Home Secretary has announced that there will be an inquiry into black and Asian recruitment, not only in the police but across the board. There is the Black Police Association but no white police association because of the under-representation of black and Asian people. That is why we back the work to increase the numbers of black and Asian members of the police service.

Several hon. Members: rose—

Mr. Deputy Speaker: Order. I thank the House; we have got through 34 questions in 51 minutes, which shows what can be done when everyone co-operates.

TOPICAL DEBATE Financial Stability

Stephen Timms: I beg to move,
	That this House has considered the matter of financial stability.
	The events in the USA in the past few weeks and in Europe in the past few days have demonstrated once again the global nature and sheer scale of the problems affecting the financial system. What started in America last year has now spread to every part of the world. Disruption in global financial markets has intensified, particularly over the past few weeks, and people are rightly concerned about what is happening. As well as the USA and ourselves, Ireland, Germany, the Netherlands, France, Spain, Denmark, Austria, Belgium and Iceland are affected; these are global problems that need international, as well as national, responses. My right hon. Friends the Prime Minister and the Chancellor of the Exchequer have made it absolutely clear that we will do whatever is necessary and right to maintain stability. Along with Governments across the world, we have the responsibility to support a stable, well-functioning banking system.
	Financial transactions are at the heart of everything that we do: they allow people to buy goods, pay for services, buy homes, save for pensions and invest for growth and prosperity. It is essential that we take action both to support the banking system as a whole and to intervene in particular cases when it is necessary to do so. It is not a case of one or the other; general support and individual intervention are needed. We want to work with other countries to tackle the causes of these problems as well as deal with their consequences.
	Yesterday, the Chancellor announced to the House the decisive, comprehensive action that the Government are taking to restore confidence in the banking system and put banks on a stronger footing. That has been widely welcomed.

Diane Abbott: The House welcomes what my right hon. Friend has said about financial stability. One of the underlying reasons for the weakness in our and America's banking systems is the weakness in the housing market and the fact that increasing numbers of people are unable to pay their mortgages. What will be done, as autumn turns to winter and winter turns to new year, to make sure that our constituents do not find themselves at the mercy of repossession? What will be done to support people in their homes and against arbitrary repossession?

Stephen Timms: I am sure that my hon. Friend will welcome yesterday's Bank of England announcement of a reduction in interest rates. Of course, if we are successful, as we hope we will be, in opening up the lending market again, we will see the housing market—and, indeed, other parts of the economy—benefit from that change. It is essential that we take action both to support the system as a whole and to intervene in particular cases when we need to.

David Winnick: Does my right hon. Friend accept that some people must be puzzled? Over the years, we have been told by all kinds of people that state intervention is wrong, that any form of extending public ownership is highly undesirable and that all such measures would undoubtedly lead to wicked socialism, which is no doubt being considered in Washington. Is it not also puzzling that at this moment, when there is such a crisis in financial markets across the world, it is precisely state intervention that is essential?

Stephen Timms: My hon. Friend is absolutely right. I have been struck by how some people who have customarily denounced any form of Government intervention are now calling for precisely that intervention.
	There are three strands to what the Chancellor announced yesterday: first, the provision of sufficient liquidity now; secondly, making available new capital to UK banks and building societies to strengthen their resources and restructure their finances while maintaining support for the real economy; and thirdly, ensuring that the banking system has the funds that it needs to maintain lending in the medium term.

Mark Pritchard: The Financial Secretary has mentioned three points, but are there not really four? First, there is a transfer of debt to the national purse; secondly, there is a deferral of debt from today until tomorrow. The third and fourth points are the subsequent choice between cutting public spending or increasing taxes.

Stephen Timms: No. The three strands are precisely as I have set them out. I am not sure whether the hon. Gentleman is expressing opposition to the package; in common with others outside the House, Conservatives have generally welcomed the proposals as precisely the decisive and bold action that is needed, given the circumstances that have resulted from the problems in the USA.

Paul Burstow: The Financial Secretary mentioned the need for bold action. In his statement yesterday, the Chancellor said that he had frozen the assets of the subsidiaries of Landsbanki in this country as a first step in trying to address the issue of retail deposits at that bank. However, he was not so clear about what was intended in respect of local authority deposits with the bank. My local authority, the London borough of Sutton, has £5.5 million in a subsidiary of that company. It was invested in a prudent fashion and in line with guidelines issued by the Treasury. The authority wants to know what will happen to that money and whether the Government will stand with it and council tax payers to make sure that the money is safe.

Stephen Timms: I am aware that my right hon. and learned Friend the Leader of the House fielded several questions about this at business questions. I can tell the hon. Gentleman that there will be a meeting this afternoon between my hon. Friend the Economic Secretary, my hon. Friend the Minister for Local Government and the Local Government Association to consider exactly this issue.

Hugh Bayley: The hon. Member for The Wrekin (Mark Pritchard), who has now left the Chamber, asked about affordability. Does my right hon. Friend take some reassurance from the editorial in today's  Financial Times, which says:
	"The government can afford this plan. National debt is relatively low and the UK can borrow more"?
	When the Conservatives left office, our national debt was 47 per cent. of gross national product. We have got it down to 37 per cent., which has created, through good economic management, the room for this kind of intervention when it is so necessary.

Stephen Timms: My hon. Friend is absolutely right. We have the lowest level of debt, other than Canada, in the whole of the G7, which means that we are in a position whereby we have the headroom that we need.

Henry Bellingham: The Minister will be aware that Norfolk county council is among a number of local authorities with money on deposit with subsidiaries of Icelandic banks. It seems to many of us that, in the circumstances post-Northern Rock, that was not the wisest thing to have done. Did the Treasury give any specific instructions or advice to those local authorities?

Stephen Timms: If a local authority has any concerns about that, I suggest that it contact the Local Government Association, which, as I said, has a meeting with my hon. Friends this afternoon.
	Within the package of proposals that we have brought forward, we will ensure that where public funds are involved there will be conditions on remuneration arrangements in banks—we do not want rewards for excessive risk-taking—and to secure and maintain credit to home buyers and to small businesses. The proposals have been widely welcomed. As well as supporting stability in the financial system, they will protect depositors, safeguard their interests and play an important part in the international response to this global crisis. In turn—

James Brokenshire: Will the Minister give way?

Stephen Timms: I will make a little more progress before I give way again.
	In turn, that should help people and businesses to support the economy in these extraordinary times. Whenever possible, countries should work and act together to maintain stability. My right hon. Friend the Chancellor has agreed with European Union Finance Ministers to work together to rebuild confidence in the banking system. All member states have now committed to immediate steps to enhance depositor protection. My right hon. Friend will also be in Washington this weekend to discuss steps to be taken internationally, including on strengthening the system of international supervision, and the Prime Minister has agreed with other major countries on a meeting of Heads of Government to ensure that international action is taken.
	It has been necessary for Government to take decisive steps to strengthen the stability of the banking system. The best solution to a firm's specific concern is, where it is available, a private sector solution. On 18 September, it was therefore announced that Lloyds TSB and HBOS were to merge following market turbulence whereby HBOS found itself in increasing financial difficulties as investors lost confidence in its ability to continue operating. To help to secure the deal quickly in the best interests of wider financial stability, the Government have changed competition rules to allow financial stability to be considered in the scrutiny of this merger. The decision on whether the merger should be referred to the Competition Commission will be taken in the normal way by the Secretary of State for Business, Enterprise and Regulatory Reform in the light of implications for competition and financial stability, and an affirmative resolution will be made to add the maintenance of UK financial stability to the list of public interest considerations in the Enterprise Act 2002.

Philip Hollobone: This banking crisis followed a severe oil price shock in the summer, with the price of oil reaching $150 a barrel. Since then, it has fallen by 40 or 50 per cent., but the price of petrol and diesel at the pumps has remained stubbornly high. Is the Minister considering the possibility of investigating anti-competitiveness among the oil companies at petrol stations, because this is having a real impact on household budgets?

Stephen Timms: The fall in the price of oil is certainly very welcome. There are also indications that the recent increases in food prices are moderating. However, the hon. Gentleman is absolutely right—those reductions need to be reflected in the prices charged to ordinary consumers.

Stuart Bell: I hesitate to interrupt my right hon. Friend's flow, but it had already been interrupted.
	Not enough is being made of the fact that there will be strict controls through the Financial Services Authority on compensation packages for the executive directors of these various banks. Let me remind the Financial Secretary of what the Chancellor said:
	"In reaching agreement on capital investment the Government will need to take into account dividend policies and executive compensation practices and will require full commitment to support lending to small businesses and home buyers."
	Can the Financial Secretary repeat that today, because it is being overlooked in the outside world, where there seems to be a view that we are going to skate away from these so-called golden parachutes?

Stephen Timms: I have already touched on that, but my hon. Friend is right to underline it. Indeed, the FSA has made it clear that it will consider remuneration arrangements as part of its assessment of the banks.

Chris Mullin: Will my right hon. Friend give way?

Stephen Timms: Let me make a little more progress, if I may.
	I talked about our response to the difficulties of HBOS, so let me move on to Bradford & Bingley. Purely private solutions to firm-specific problems are not always available, and there will be circumstances in which the Government need to take steps to deliver solutions with the private sector to ensure that depositors are protected and that banking services are not disrupted. Following a period of extreme market dislocation, Bradford & Bingley found itself in increasing difficulties as investors lost confidence in its continued independence. On 17 September, the FSA declared that Bradford & Bingley no longer met its threshold conditions as a deposit taker, and after consultation with the FSA and the Bank of England, and having explored all the options, we announced that Bradford & Bingley's UK and Isle of Man retail deposit business, along with its branch network, would be transferred to Abbey. The remainder of Bradford & Bingley's business was taken into public ownership through the transfer to the Treasury of the company's shares. That included its mortgage book, personal loan book, headquarters and relevant staff. The remainder of Bradford & Bingley's business will be run down over time—for example, as mortgages are repaid by its customers. The Treasury and the financial services compensation scheme will recover payments in the wind-down. The financial services compensation scheme paid out approximately £14 billion to enable retail deposits covered by the scheme to be transferred to Abbey. The Treasury has also made a payment to Abbey for retail deposit amounts not covered by the financial services compensation scheme—some £4 billion. We fully expect taxpayers to get the full £4 billion back.

James Brokenshire: The Minister has been talking about the recovery of assets. He will be aware that the Chancellor said that Icelandic accounts had been frozen and that steps would be taken to recover the assets. Can the Minister give any further update on the measures that are being taken and on any further discussions that have taken place with the Icelandic authorities on the recovery of those funds?

Stephen Timms: I will come to the position of the Icelandic banks in a moment, but I wanted first to update the House on the range of issues that have emerged.
	If there are losses at the end of the wind-down of Bradford & Bingley, the cost will be met first by Bradford & Bingley shareholders and subordinated debt-holders. The financial sector and the Treasury will then share any further losses between them. It is anticipated that the financial sector will bear a significant proportion of any such further losses from future profits when financial markets return to normal. It would require some £4 billion of impairments on the mortgage assets before the Treasury and the taxpayer suffered significant losses. Moody's credit rating agency estimates that asset impairments will amount to about £1.2 billion. We are confident that, through quick and decisive action, we are doing whatever it takes to stabilise the financial system in the UK while protecting the taxpayer.
	Savers at Bradford & Bingley are now savers at Abbey, with the assurance of their deposits being with a major bank. Savings can be accessed in the usual way and remain covered by the financial services compensation scheme. Bradford & Bingley's branches, call centres and internet operations continue to be open for business as usual. The Government have also guaranteed that for those working in Bradford & Bingley's headquarters, there will be no compulsory redundancies over the next six months, employee terms and conditions will remain unchanged, and pension rights will be protected.
	On the issue that the hon. Member for Hornchurch (James Brokenshire) just pressed me on, acting yesterday on the advice of the Bank and the Financial Services Authority, and in light of recent announcements by the Icelandic authorities, the Chancellor took action to protect retail depositors in three Icelandic banking operations in the UK: Icesave, which is a UK-based branch of Landsbanki; Heritable, which is a UK-based banking subsidiary of Landsbanki; and Kaupthing, Singer and Friedlander, which is a UK-based banking subsidiary of Kaupthing bank. That action was taken to ensure stability of the UK financial system and savers' money is now safe and secure.

Mark Hoban: For the sake of clarity, will the Financial Secretary say whether savers' money is protected up to £50,000, or above £50,000?

Stephen Timms: As my right hon. Friend the Chancellor made clear, all the deposits by retail savers will be protected.
	Yesterday, the FSA deemed Icesave to be in default. Because of the Chancellor's decision, no retail depositor will lose any money as a result of the closure of Icesave. The Treasury and the financial services compensation scheme are working with the Icelandic authorities and their deposit insurance scheme to ensure that depositors are paid back as quickly as possible. My right hon. Friend the Chancellor emphasised to the Icelandic Finance Minister that UK depositors in Icesave should have the same protections as depositors in Iceland, and receive their deposits back in full promptly. Arrangements are being put in place to ensure that all ISA customers of Icesave will continue to benefit from the tax-free status of their accounts.
	To protect UK economic interests, the Government have frozen the funds and financial assets held by the Icelandic bank, Landsbanki. We fully understand the exceptionally difficult challenges faced by the Icelandic Government and the pressure that they are under. We want to work co-operatively and constructively with them, particularly to ensure that depositors and creditors are protected. We have, though, been unable to obtain complete clarity from Iceland on the position, so the freeze we introduced is a precautionary measure protecting UK interests, and it could be lifted once safeguards are in place to prevent action detrimental to the UK economy.

Julia Goldsworthy: I just have a quick question on the freezing of assets. Could the Financial Secretary clarify under which legislation the assets were frozen? My understanding from reports in today's newspapers is that the freezing took place under anti-terrorism legislation, and I am interested to know how the Government justified freezing the assets through such legislation.

Stephen Timms: The important thing was to safeguard UK economic interests. The hon. Lady is quite right: the power used happened to be in the Anti-Terrorism, Crime and Security Act 2001, but it was felt necessary to protect UK economic interests.
	Yesterday, the FSA also deemed that Heritable and Kaupthing did not meet threshold conditions. In order to provide for as much business continuity as possible, the majority of Heritable's retail deposits, and the Edge accounts in Kaupthing, were transferred to ING Direct, using the Banking (Special Provisions) Act 2008. ING Direct is working rapidly to ensure business as usual for customers. Action by the tripartite authorities protects savers' money and provides certainty for retail depositors. The transfer of the retail deposit book has been backed by cash from the Treasury and the financial services—

Madam Deputy Speaker: Order. I am afraid the right hon. Gentleman's time is up.

Mark Hoban: Over recent months, we have seen the impact of the credit crunch move beyond the banking system, first to home owners and now to businesses. What was seen as a problem of banks being unwilling to lend to each other has become a problem of banks being unable or unwilling to lend to their customers. In the mortgage market, that has been characterised by lower loan-to-value ratios as banks ration credit, and higher interest rates as the spread between the London interbank offered rate—LIBOR—and the base rate widens. Businesses are seeing comparable issues. For example, businesses have seen their overdraft rates go up from 10 per cent. to 15 per cent. The markets seized up because of concerns about banks' capital and their ability to withstand losses, which added to concerns about liquidity.

Ann Winterton: There has been much speculation about the mark-to-market rules, which have played their part in creating this instability. Can my hon. Friend confirm that the implementation of mark-to-market rules is a European Union competency?

Mark Hoban: As I understand it, the mark-to-market rules fall within international accounting standards, which are implemented through EU law. The International Accounting Standards Board is looking at how illiquid financial instruments are valued in the absence of financial markets. That work is ongoing, and we need co-operation between the EU and the United States on that issue because there is a risk of divergent standards being used.

Doug Henderson: Following the point raised by the hon. Member for Congleton (Ann Winterton), would the hon. Gentleman agree that it is unlikely in the long term that confidence will be built in inter-bank lending or in consumer depositing internationally until international regulations are established by an organisation such as the International Monetary Fund, so that people would know that if a financial institution did not meet regulations, there might well be something dodgy going on?

Mark Hoban: I am not sure whether the hon. Gentleman is referring to accounting standards, which are rightly set by the International Accounting Standards Board, or a single global regulator. There is a cross-party consensus that there should not be a global financial services regulator, but this crisis has demonstrated the need for greater international co-operation when it comes to such challenges.

Stuart Bell: I congratulate the hon. Gentleman on his knowledge of competencies and the relationship between accounting standards and European law. He mentioned co-operation with the United States and, to enlighten him further, the US Congress is at this moment looking at mark-to-market. Everything will come together in a package one way or another, and I am sure that the hon. Gentleman will welcome that.

Mark Hoban: My knowledge of international accounting standards comes from the fact that I am a chartered accountant, although I am no longer practising. When looking at mark-to-market, and international moves to deviate from that—my right hon. Friend the Member for Witney (Mr. Cameron) proposed a temporary suspension of mark-to-market last week—it is important that we adopt a common approach. It is unhelpful if the US adopts one approach while UK and European markets adopt another. There needs to be some consistency if we are to have comparability of financial statements.
	The seizing up of inter-bank lending has led to illiquidity as banks seek to hold on to cash. As Northern Rock shows, a bank can be solvent, but still face problems because of liquidity. We believe that action needed to be taken to tackle both liquidity and capital and that you could not tackle one without tackling the other. This is where yesterday's £50 billion rescue package is pivotal in its support for recapitalisation and further moves to improve liquidity in the inter-bank market. I want to raise some detailed questions about yesterday's package in a moment.
	Taxpayers will ask us why we needed to do this, who else is sharing the pain and more crucially, how we will know if it has worked. The answer to why we need to do it is clear: financial instability has caused problems for businesses and households, and if action had not been taken those problems could have got far worse. It is also clear, however, that if taxpayers are to bear risk they need to know that others are taking their share of responsibility, too. Banks will have look again at dividends to conserve their capital and there will be little public support for banks paying bonuses when the taxpayer is at risk.

Hugh Bayley: Writing in today's issue of  The Daily Telegraph, the Conservative party leader sought a guarantee that there would be no bonuses for senior executives of banks that have taken the greatest risks. Is that just political bluster or does he have a list of the banks in question? How would the hon. Gentleman's party propose to ensure that no bonuses were paid? What legislative measures would it put in place to ensure that?

Mark Hoban: The hon. Gentleman seems to have spent much of his time this morning reading the newspapers.

Hugh Bayley: I do read the newspapers—and so does the hon. Gentleman.

Mark Hoban: It is good that the hon. Gentleman does that. He should have asked the Financial Secretary how the Government intend to achieve what he outlined, because yesterday's statement refers to executive compensation packages. There will be an agreement between the Government and banks on recapitalisation using the £25 billion that has been set aside. It would be interesting to hear the Government present their mechanism for that. Perhaps the Financial Secretary could outline the Government's progress on it.

Hugh Bayley: rose—

Mark Hoban: I am conscious that many hon. Members want to take part in the debate, and I have already been generous in taking an intervention from the hon. Gentleman.
	The package will not work if it simply enables people in the City to breathe more easily and leaves those in our cities and towns no better off. The conditions attached to it are therefore important. How will the Government ensure that the banks'
	"commitment to support lending to small businesses and home buyers"
	happens in practice? The Prime Minister and the Chancellor ducked that question yesterday—I hope that the Financial Secretary is in a position today to give us an answer because the link is important if the package is to work.
	I shall ask detailed questions about the three aspects of the scheme. The special liquidity scheme has been extended to the end of January and increased to £200 billion. If there is continued demand for it, can it be extended in duration and increased in value? People in the banks will be interested in the answer to that.
	On the equity package, one of the eligible institutions is the Nationwide building society, and other building societies could also be eligible. What are the consequences for the mutuality of building societies if they seek Government support to recapitalise their balance sheets?
	Will the Financial Secretary clarify the purpose of the second tranche of £25 billion? We understand that it can be used to invest in only preference shares or permanent interest-bearing shares, yet the Treasury press release yesterday stated that the Government are
	"willing to assist in the raising of ordinary equity if requested to do so".
	Does that mean that the Treasury will invest in the ordinary shares of banks and eligible institutions? If not, will the Financial Secretary explain that statement in yesterday's press release?

Peter Bone: My hon. Friend makes an important point. A small part of yesterday's statement suggested that the Government would underwrite issuing new ordinary shares. If that is the case, the package is different from what we have been led to believe.

Mark Hoban: My hon. Friend highlights the ambiguity in the statement. It is important that the Financial Secretary uses the opportunity today to clarify the point, because investing in or helping underwrite ordinary shares is different from investing in a form of preference shares.

Barry Gardiner: rose—

Mark Hoban: I am happy to give way to the former envoy for forestry.

Barry Gardiner: The contemporaneous note that I made during yesterday's statement said that the underwriting of new debt would be temporary, and not simply the underwriting of new shares per se.

Mark Hoban: I am grateful for that clarification, but the problem is that the statement, as published yesterday on the Treasury website, is not sufficiently explicit about the meaning of assisting in raising ordinary equity. Some clarification would be helpful rather than relying on  Hansard or contemporaneous notes.
	Will the Financial Secretary explain the link between the recapitalisation fund and the £250 billion facility to guarantee the repayment of short and medium-term debt issuance? If a bank does not take Government money for recapitalisation—I understand that at least three institutions so far have declined to do that—can it take advantage of the Government guarantee? If a bank has not sought any of the £50 billion available for recapitalisation, but wants to use the guarantee, is it bound by the commitment to
	"support lending to small businesses and households"?
	If so, how will that be policed?
	Currently, the scheme is limited to eight eligible institutions, although the Treasury press release makes it clear that other UK incorporated banks, including those that are subsidiaries of foreign banks, can also join the scheme. Clearly, Abbey, as a financial institution, is an example of that form of organisation. However, other UK incorporated banks are subsidiaries of foreign banks, for example, J.P. Morgan and Citibank. Will they have access to the £250 billion guarantee fund? Will institutions that operate primarily in the wholesale market also have access to it? They are unlikely to lend to households or small businesses, and some clarity would therefore be helpful.
	Are the Government confident that the £250 billion is enough to help institutions refinance their wholesale funding obligations? What work have they done to assess the adequacy of the fund? I do not know where the figure has come from or the suggestion that it is enough. Might it be topped up later? Again, some clarity would be welcome, not only in the House but outside. When can eligible institutions use the guarantee fund? The statement on the Treasury website was silent on that matter. Institutions that wish to refinance their short and medium-term debt issuance will want to know when the fund is open for business.
	I have made some detailed points, but I think that the Financial Secretary appreciates that more clarity about the way in which the money is to be used, who has access to it and how the conditions are policed will not only help financial institutions that may benefit from it understand what is happening, but help our constituents, who are paying for the package, understand how the Government will secure the link between the money that has been advanced to the banks and their commitment to support lending to small businesses and families.
	Next Tuesday, we will return to the debate on banking reform. The Banking Bill sets out several mechanisms, which have partly been used during the past year to rescue institutions with problems. However, we need some long-term changes to entrench financial stability. The Bill that we discuss next week deals largely with the consequences of failure, not prevention of the recurrence of such problems.
	Conservative Members believe that, in setting up the FSA, the Prime Minister broke the link between the understanding of market-wide risk and the supervision of individual institutions. To avoid the repeat of a debt bubble, we believe that we need to reinstate that link, with the Bank of England being given a much greater role in determining the overall amount of capital needed in the market. That will strengthen the system and entrench financial stability in markets. The Government have embraced our proposals to increase the deposit protection limit from £35,000 to £50,000, and a bank-led reconstruction of a failing institution. Perhaps they will endorse the idea that I have just outlined.
	As we have made clear, for the package to work, we need not only inter-bank lending to reopen, but lending to businesses and families to recommence. Taxpayers want an end of the age of irresponsibility, but they also want responsible lending. That is the true test for this package, and we hope that it meets that test.

Several hon. Members: rose —

Madam Deputy Speaker: Order. Mr. Speaker has imposed an eight-minute limit on Back Benchers' contributions, but several hon. Members have expressed a wish to participate in the debate since then. Given that we have rather less than an hour, may I ask hon. Members to restrict their comments further?

Mark Lazarowicz: There is undoubtedly much concern among the public about the fact that the bail-out for the banks is necessary. I am sure that I am not the only Member of Parliament who has had e-mails and phone calls overnight from constituents who are angry that people who have made massive amounts of money and enjoyed massive bonuses are expecting the taxpayer to pick up the tab for their mistakes. That public anger is not misplaced, but there is no doubt that yesterday's action was right and necessary.
	I speak as a Member who represents a constituency in Edinburgh, where the problems in the banking and financial industry have a direct and immediate local dimension. Sixteen thousand people in Edinburgh are directly employed by HBOS or the Royal Bank of Scotland. Thousands more are employed in Lloyds TSB or its subsidiaries, such as Scottish Widows, and thousands are employed in other businesses, such as Standard Life. On top of that, many thousands of my constituents are employed in sectors dependent on the banks and financial services. That is why I and other parliamentary colleagues from Edinburgh have been in regular contact with senior management in those businesses, with our colleagues in the Scottish Parliament and in local government, and of course with the Chancellor, to discuss those issues at this worrying time.
	The package that was announced yesterday should certainly reassure those who are employed by the banks and the financial sector in Edinburgh, Halifax and elsewhere. It should make it more possible to achieve an ordered recovery from the current crisis and for decisions to be taken in the longer-term interests of the banking sector and the economy as a whole. I hope that, along with the effect on small businesses, one of the factors that the Government take into account when they agree the details of any support for particular banks will be the effects on the thousands of ordinary people employed by those businesses, in places such as my constituency. The ordinary workers in those businesses should not be the victims of greed and excessive ambitions higher up in those institutions.
	However, everyone in Edinburgh would of course be affected in the same way as those in the rest of the UK by a meltdown in the banking sector. The local authorities that now face the loss of millions of pounds as a result of the failure of an Icelandic bank emphasise how the effects of a bank failure rapidly spread into the wider world. If, heaven forbid, one or more big British banks were ever to fail, it would not be just a few local authorities that would face the situation that some face now. Every local authority in the country would have severe difficulties in meeting its pension commitments and continuing to provide vital services for their communities.
	The same would be true of pension funds and there would be consequences for those seeking to remortgage. There would also be consequences for millions of businesses, which would have difficulties with cash flow. Problems would arise in international trade and there would be consequences for the stock market and threats to the billions of pounds of private savings if any banks were in that situation.
	That is why it was right for the action to be taken and why it had to be dramatic and bold action. We have to remember that the collapse in the 1920s was one of the contributors to the eventual growth of dictatorships and fascism and, ultimately, the second world war. That might sound dramatic, but it is a reminder of a reality that we could face if action were not taken internationally to try to tackle the current crisis and if the banking system seized up. That is why the action taken this week is welcome, but it can only be the start of much more dramatic and radical action at the national and international levels combined.
	First, we need to return to sound banking practices here in the UK. Hon. Members asking questions yesterday expressed their fears that once the immediate crisis was, hopefully, over, some in the financial sector would return to their bad old ways. That is a real concern. The problem is not just with a few people at the top, earning big bonuses. There is a cultural problem in much of the industry that needs to be addressed and on which we need action in a number of ways, from the Government, the regulators and the industry itself. The public will expect us to do that and they will be very angry indeed if the problem is not addressed in a thoroughgoing and long-lasting way.
	A return to sound banking will also be more likely if the Government and regulators seek to strengthen those parts of the financial services sector that have now fallen prey to the greed and irresponsibility of some, but not all, in other parts. I refer to the strength displayed by the mutual sector—the building societies. Although there have been problems, which have been dealt with so far, the building societies certainly have not overextended themselves with massive international expansion, funded by expensive borrowing, in the way that some of the banks have. I would therefore like to hear an answer to the question that the hon. Member for Fareham (Mr. Hoban) asked about how the mutuals would be affected if they wished to take advantage of the financial arrangements announced yesterday.
	Secondly, it is clear that we need stronger international rules and agreements to ensure that collective action can be taken successfully. The action taken by the UK so far can lead the way in setting an example for the rest of the world.
	Finally, we also need to strengthen the ability of the European Union to act together. The fact that that did not originally happen in the way that it should have happened should not lead us to the conclusion that the EU's role should be weakened. Rather, the conclusion that we should draw is that it is time to strengthen the EU's ability to ensure that its members work together in such crises and put into effect a common response and action plan when it is agreed. That might not be popular with Eurosceptics in the Chamber, but now is the time for more European co-operation, not less.

Jeremy Browne: The context of today's debate is the understanding that every economy needs a functioning banking system. Businesses and individuals have to be able to borrow money to invest. Without that confidence, the economy as a whole and, indeed, our whole society, is adversely affected.
	We on the Liberal Democrat Benches therefore welcome the financial rescue package that the Prime Minister and the Chancellor announced yesterday. It was in the national interest; it was the right thing to do. That does not make it any less galling that the greed and excesses of the banks have put us in this position. However, when a house is on fire, recriminations about how it started are secondary to putting out the fire. That is the task that we have now embarked upon.
	Changes in the rules of engagement between the taxpayer and the banks are nevertheless inevitable as a result of the Government's intervention, as well as being desirable. It is essential that the taxpayer's investment is as advantageous in its terms as possible. If, or perhaps when, normal order resumes and banks return to profitability, I want to see the return on that investment at the highest possible level for the British taxpayer.
	Senior bankers also have to wake up and realise that their old ways are in the past. Unlike the Conservatives, I do not want the Government to micro-manage every boardroom decision. I say this with kindness to the Conservative party: running a bank is not like deciding the location of chocolate oranges in WHSmith. We are talking about the banking sector being free to make innovative decisions, but within the changed context of the different times in which we find ourselves. The City and the wider banking sector must realise that the context is now different.

Diane Abbott: The hon. Gentleman talks about micro-management of boardrooms, but I do not think that anybody, in any part of the House, has talked about micro-management. What we are talking about is effective and substantive regulation, which has not necessarily been in place in the past 10 years.

Jeremy Browne: I take the hon. Lady's point about effective regulation, but, as I understand it, the leader of the Conservative party is keen for the Government to intervene and decide the remuneration policy of people working in the banking sector. That is an extraordinary transformation. The Conservative party, which wholly embodies the culture of excess and "loadsamoney" banking spivvery, is now going to a 1970s incomes policy. I know that many on the Conservative Benches look back to the era of Margaret Thatcher with fondness, but this is the first time that I have seen Conservative Members look back with such enthusiasm to the era of James Callaghan.

Adam Price: I know that the Liberal Democrats' new political strategy is to put themselves to the right of the Conservative party, but surely when the banks are coming cap in hand to the taxpayer, it is reasonable for the taxpayer to except a degree of accountability—that is, no fat cat bonuses. What is unreasonable about that?

Jeremy Browne: It is entirely reasonable that the taxpayer, having taken a stake in the banks, should have an interest in how those banks operate. However, that is not the same as setting an incomes policy for banks and deciding on the remuneration of individual bankers. I know that the issue is a mere footnote to the great events that have taken place in recent weeks, but it highlights the dangers of a party using shallow marketing devices to reinvent itself without any reference to core beliefs and values.

Mark Hoban: The hon. Gentleman is making an extraordinary series of allegations, but let me ask him this: is he going to go back to his constituency this weekend and tell his constituents that the bankers who are being bailed out by taxpayers' money deserve bonuses?

Jeremy Browne: I noted that, when the hon. Gentleman had the Floor earlier, the hon. Member for City of York (Hugh Bayley) asked him how the leader of the Conservative party envisaged the Government enforcing an incomes policy in the banking sector. There was no answer from the Conservatives, because they do not have any practical way of delivering their policy. They think that the best way of deflecting attention from the fact that they have no credible policies whatever in this area is to give this nod to populism.
	My answer to the hon. Member for Fareham (Mr. Hoban) is that of course the circumstances have changed when the taxpayer is investing so heavily in the banking sector, but the Government cannot decide in every minute detail how the banks should be successful and go forward. There may be circumstances in which a particularly innovative, entrepreneurial banker is so successful at turning round the fortunes of his bank—to the advantage of my constituents and the hon. Gentleman's—that that needs to be recognised. I am sorry if the Conservatives find that frighteningly right wing, but I do not believe that it is possible to run the entire banking sector and the boardroom of every bank from the Chamber of the House of Commons.

Diane Abbott: Will the hon. Gentleman give way?

Jeremy Browne: I am getting a bit distracted, but I will give way one more time.

Diane Abbott: The hon. Gentleman does not seem to understand that one of the issues in this debate about the remuneration of bankers is whether banks pursue bonus policies that encourage people to make short-term profits without paying attention to the long-term sustainability of their own financial institutions.

Jeremy Browne: I do understand that point. I am not saying that I am in favour of all bonuses or of bonuses for short-term behaviour that is disadvantageous to the long-term prospects of a bank. But that is not what the Conservatives are saying; they are saying that they are against any bonuses being paid in the banking sector in any circumstances. Bonuses are also being paid in the public sector at the moment. I do not favour that practice because, by and large, they are being given to people who are simply doing the job for which they are already paid a salary. However, there might be circumstances in which there is such exceptional performance in the public sector that it is right to recognise it financially in order to create incentives to greater creativity, flair and entrepreneurialism and to a more effective delivery of services. I am simply saying that we should keep that scope in the banking sector as well. I do not think that the Conservatives are wise to say that, however good the bankers are, the Government should intervene in all circumstances to prevent a bank from paying a bonus to recognise outstanding creativity, talent and wealth creation.
	It is important that there is a housing dimension to the Government's action. The £8 billion of public money that has already been approved for social housing should be used rapidly to acquire the land and property that is becoming available at big discounts at the moment, due to market circumstances. Steps must be taken to protect home owners from premature and unnecessary repossessions.
	In addition to the financial package that was announced by the Prime Minister and the Chancellor yesterday, the Bank of England announced a half-point interest rate cut. My party welcomes that decision by the Bank. Its effectiveness was increased by it being part of a co-ordinated international approach that cut interest rates in the leading industrial countries around the world. However, it is fair to say to the Bank of England that this is not the time for cautious incrementalism. We are entering an era in which more dramatic action will have to be taken on interest rates to try to restore greater confidence and to give people the ability to lend and borrow, which they have felt unable to do in recent months. I, and most observers, expect further interest rate cuts to follow.
	We do not know whether the Government's action will succeed, but we know that it must do so. The only plan B available to us is to continue with plan A until we are clear of the crisis. Financial stability is essential for the workings of our entire economy, which is why the rescue package announced by the Prime Minister and the Chancellor has our support.

George Mudie: As time is short, and there are many Members here, I shall move quickly through my speech. I shall not, however, take the advice of my Newcastle colleague, my hon. Friend the Member for Newcastle upon Tyne, North (Mr. Henderson), who has just suggested that, if I wanted more time, I should make my speech in the next debate, when I would get 15 minutes. Of course, you would notice if I did that, Madam Deputy Speaker.
	I have heard what has been said in the debate, but I think that congratulations are in order. We cannot go overboard, but I think that the package that was delivered yesterday was a very good one, in both content and presentation. If we compare its content with that of the US package, we see that it is completely different, in that it is far more relevant and far more likely to be successful. Its presentation, despite being spoiled by some nonsense, to which I shall return later, involving discussions between the Opposition and officials, was very good. It has gone down very well, and the Government have certainly played their part in doing what they can in the global fight for stability. Locally, we have certainly delivered a package.
	As a member of the Treasury Select Committee, I did one or two interviews yesterday. The media seemed to have moved on to the next day's news—or the next hour's news—and were asking what would happen if the plan did not work. We put £400 billion into the equation, yet they still wanted to know what would happen if it did not work. The answer has been given by the Prime Minister and the Chancellor of the Exchequer: if it does not work, we will do whatever it takes. That is the only possible answer.
	Today, although the markets have stabilised and even gone up, the situation is still volatile. We do not know whether the plan is going to work. We can only hope. Some Members have asked about the cost of the package and how we are going to meet it, but that does not matter. We have to win this battle, because the price of losing it would be so devastating for ordinary people's standard of living, so we will do whatever it takes. This is not simply about money. It is more about money plus confidence. If confidence results from this package, that will be lovely. If it does not, another package will have to be delivered until confidence returns to the markets and we can get back to normal.
	I am delighted to see what is emerging as a result of the package, although it places some pressure on the Minister. When the lending facility for the special liquidity scheme was introduced by the Bank of England, and introduced in the Chamber by the Chancellor, I made the point that we were talking about creating a £100 billion facility to rescue the banks—the very people who got us into this problem. Has any part of the negotiations tied the banks not only to rescuing themselves with the money, but to ensuring that their customers—small businesses and, above all, home owners—are rescued? The answer that the Governor of the Bank of England gave to the Treasury Select Committee was that that was not his concern. The Chancellor answered that it would be improper for him to take such action.
	I am delighted that things have moved on, and that this larger package contains specific reference to freeing liquidity in loans, and to lending to home owners and to small and medium-sized enterprises. However, when the Minister was questioned on the package earlier, he suggested that it should do certain things. I wonder whether we can press him on this issue. I do not fancy going back to my constituency and telling people that, this week, we made £400 billion available to rescue institutions headed by people whose reckless—one could say greedy—behaviour has endangered the economy of this country and the livelihoods of most of its people. I do not fancy telling my constituents that, without also being able to say that, in moving to save the banks to stabilise the financial markets, we have obtained an explicit agreement that, as soon as possible, and in defined terms, they will start proper lending facilities.
	The chief executive of the British Chambers of Commerce was on television this morning: a survey of 5,000 businesses has been undertaken and every indicator is negative. Above all, we must look at the number of housing repossessions that are taking place. At first, we had a problem caused by the financial markets in the financial markets and the real challenge was to see whether we could prevent it from spreading to the real economy. It looks as though we may fail, but this is our last chance. If we have not nailed these bankers to an agreement that is explicit and that will be honoured, we will not be thanked by ordinary people watching events on television, doing their sums and looking at their household budgets and worries. I press the Minister to tell us whether all this is a hope, trickle-down or something that will happen.
	On salaries, I cannot understand the hon. Member for Taunton (Mr. Browne), and there is real sense in questioning both parties that say that something should be done. Something will be done. There is the question of having a bit of fun and saying, "Tell us the details," but it is more important that there is political will. If we say to people out there, "We've rescued the ones who caused you these problems, but we haven't got an understanding that they will change their behaviour," once again we will not be forgiven. We need that political will.
	I hope that, for the first time, the banking and finance industry will show a bit of humility and put its own house in order, but if it does not do so I hope that we retain the consensus to do something about it.
	I say to the Minister and the Chancellor that this is a great package, but given the amount of money we put into those institutions I cannot understand why we did not get board representation. Lending policies are being considered and salary policies are on the table. We ought to have our representative in there to ensure that our part of the deal is delivered.
	I am sad that the Liberals have departed from Bank of England independence. That independence was given and supported, but when things get tough they want to take it away. The Bank of England and the Government must improve their relationships a bit, including more trust and more partnership, but taking independence away from the Bank would be a wrong step.

Andrew Tyrie: I agree with a great deal of what the hon. Member for Leeds, East (Mr. Mudie) said, and I might come on to a few of those points.
	Government action has been required to recapitalise the banks for quite a while. It was made particularly urgent by the collapse of Lehman, which sent shivers through the banking system. Cash hoarding and de-gearing by banks was being reinforced by counter-party risk, with the banks themselves fearful that other banks might go bust. Finally and belatedly, the Government have responded to widespread calls for a recapitalisation plan, and I think we should support it.

Charles Walker: One of my concerns is the fact that the Government are positioning what has happened as purely a failure of the banking sector. They have had financial stewardship of this country for the past 11 years. Surely they must take some responsibility for getting us into this position and for the failings of the regulatory bodies that are meant to oversee the activities of the banking sector.

Andrew Tyrie: I strongly agree. It is important that we alert people to the myth that is being propagated, which is that, somehow, this crisis blew over on a transatlantic breeze. Of course, it was partly made here as a result of excessive borrowing by the Government, the corporate sector and individuals.
	Furthermore, the crisis has been made worse by the failure to act quickly. Throughout, we have had a reactive policy from the Government. This is the first time that they have been prepared to look comprehensively at what has been a deepening crisis. The package was not the product of several weeks of hard work, still less months, and one has only to look at the Treasury press release to see how thin it is. It is absurd—in fact, it is an insult to the intelligence of us all—that the Chancellor and the Prime Minister should suggest that it was the product of a lot of deep work.
	So we are left with a lot of questions that now need to be answered. My hon. Friend the Member for Fareham (Mr. Hoban) asked quite a lot of them, but I will add a few in general terms. First, is this really a voluntary scheme, or were the banks, as appears to be the case, dragged to the table to agree to it? What will the Government do if the full £25 billion window is not taken up? There is first-mover disadvantage to taking up such deals. The banks that ask for the money are perceived by the markets to be made weaker as a consequence.
	Secondly, will the facility be drawn down and will it be allowed to be drawn down primarily by the weakest banks? Will there be limits as a proportion of market capitalisation for each bank? There are great risks to the taxpayer from pouring most of the money into the weakest banks. The upside for the taxpayer will obviously be much smaller, but, on top of that, the strengthening of the balance sheets, and therefore the propping up of the management of the weakest banks, might get in the way of the consolidation of the banking industry, which is what we need. We need the sector itself to run that consolidation around the management of the strongest and best banks. For those reasons, in Monday's edition of  The Times I advocated a comprehensive scheme in which the Government would take a stake across the whole sector.
	The third question revolves around shareholder activism. I strongly support greater shareholder activism in the corporate sector—the hon. Member for Leeds, East alluded to that—which should include oversight of compensation and small business lending. Should the Government be involved in that process? I would much prefer them not to be. I would like them to commit to handing all the corporate governance functions and aspects of the package to the Financial Services Authority.
	Furthermore, I would like the Treasury to make it clear that in exercising that shareholder influence the FSA will act on the same basis as all shareholders—that is, long-run profit maximisation. The reason for that is something we should not forget: the health and prosperity of those banks represent the country's savings and pensions. The last thing we want is the recovery of the banks, which will come, to be suffocated by politically inspired excessive regulation.
	That brings me to another issue. We have heard a lot of vague talk about more regulation. We do not want to find ourselves being drastically over-regulated by a panic response. Furthermore, it is quite possible that the United States will engage in exactly that overreaction. We should ensure that we are well placed to benefit from it. That is what happened over Sarbanes-Oxley—we picked up some of the listing business. It is what happened many years ago over what was known as the interest equalisation tax, which enabled the eurodollar deposit market to come to the UK. Regulation needs to reflect the lessons of the crisis, but it also needs to have in mind the fact that there will be opportunities in the recovery phase for the UK and for UK businesses. That recovery phase will come.
	The fifth question is, what will be the criteria for judging whether the Government's package is a success? The Government should give us confidence, and give confidence to the markets, that we know how to measure that success. They should also give us some indication of contingency planning for what we would do if it turned out that those criteria were not being met. I could throw out a few examples, but obviously I am not trying to devise anything remotely full or comprehensive. Will it be a return to normality in the inter-bank market or the commercial paper market, or in relation to commercial lending generally? We need to be given some indication of what constitutes a return to normality. The absence of guidance on what the Government would do in such circumstances has been damaging the markets further in recent weeks, prior to the announcement of the package.
	I would like to raise a number of other issues, but I shall raise only one to enable other hon. Members to speak, although I suspect I may burn up the remainder of my speaking time. The issue of lower interest rates has already been mentioned today. The half-point cut is welcome and I completely agree with the criticism made by the hon. Member for Leeds, East of the policy of the Liberals: at the first sign of difficult anti-inflationary gunfire, they want to start to tear up the system that has been put in place. That is what it would mean if we were to alter the inflation target.
	On the other hand, although I do not make a habit of trying to second-guess the MPC, I do not think that they have got it right this time. Interest rates should always be set at the equilibrium point between a balance of risks. We can easily ask ourselves what those risks are at the moment. Is the risk of a sharp economic downturn, and the accompanying monetary contraction, bigger or smaller than the dangers of deeply embedded and prolonged inflation? That is the choice that the MPC needs to consider. I think it is clear that the balance of risks lies on the side of the danger of contraction, and that points to lower, not higher, interest rates. Cuts can always be reversed if the economy recovers quickly and confidence returns, and if there is a return to a risk of embedded inflationary expectations.
	However, that is not the crucial issue for the country at the moment. The crucial issue must be to get through this crisis by showing vigorous Government action—whatever is required to ensure that confidence returns to the banking sector. I strongly welcome the package, but I regret that it has come so late, and only after strong pressure, especially from the Conservatives—over the weekend, and in some detail in the press on Monday and elsewhere, completely contrary to what the Liberal spokesman suggested. The Government must now start demonstrating that they are doing far more of the contingency planning to bring confidence to the market than they have shown in the previous 14 months of this deepening crisis.

Diane Abbott: Obviously, the whole House welcomes the financial rescue package, but it is not the end, or even the beginning of the end, of stabilising our financial and business worries. It is the beginning of the process. The House and Select Committee system will have to continue to question Ministers on many issues, some of which have been raised this afternoon.
	There is a lot of talk about individual bankers and their greed, and a lot of talk about toxic assets, as if they were meteorites that came from outer space and landed in the vaults of the financial institutions. I will not talk about individual greed, although it is attractive to do so, because the real issues are structural and institutional and relate to the regulatory system.
	In the 1990s I served on the Treasury Committee, and we conducted a major inquiry into the collapse of Barings bank. The reason why Barings collapsed was not that Nick Leeson was greedy or even a criminal, but first because he was trading in derivatives, which no one in the management of the bank understood. They were quite happy for such trading to go on, however, as long as they could trouser their bonuses. Barings folded because of trading instruments that people did not understand and failure of management controls. In that instance, Nick Leeson was not just a trader but covering the back office. The lessons of the collapse of Barings—that management should understand what they are trading and making their profits in, and the lesson about management controls—have not been sufficiently learned.
	On the question of regulation, although my right hon. Friend the Prime Minister did many wonderful things as Chancellor of the Exchequer, the tripartite system of regulation, with the FSA, the Bank and the Treasury attempting to regulate the banks, has not been a success. One does not have to be an economist or an investment banker to know that if three sets of people try to do something, it will not be done effectively. It is time to revisit bank regulation; it should not be more complicated or onerous, but more effective.
	I remember taking evidence from the Bank of England regarding the collapse of Barings and then BCCI—Bank of Credit and Commerce International. We rather mocked the Bank for its notion of regulation, which was, "We're all good chaps in the City of London. We have you in for a nice chat, you reassure us and we send you away again." Banking regulation has moved on slightly from that approach, but perhaps not as far as we would like. There is a case for more scrutiny, and to reopen the issue of audits. Many of the banks that are now collapsing have been audited in the past 12 months. The auditors did not reflect any problems with underlying asset values in their audit. When we ask auditors about that, they say that they go on what they are told—if they are told that the asset is worth a certain amount, that is what they put in the audit. If the audit process just allows the big five audit companies to make a lot of money by going through a process, but gives no real information to the public or politicians as to the underlying health of the company, there is something wrong. Such audits are not aiding transparency, regulation or public understanding.
	This view will be extremely unpopular, but I am the only person in the Chamber, and one of the few Members still in Parliament, who voted against independence for the Bank of England in 1997. I voted against it because of just this eventuality. The history of the Bank in past financial crises, going all the way back to the 1930s, is that when it is asked to choose between bearing down on inflation, and the growth and health of the real economy, it has always chosen to bear down on inflation. That is the danger of an independent Bank of England, about which I spoke 10 years ago. An independent Bank of England that chases inflation above all is marvellous when the going is good. When the going is bad, however, we will see why some of us would not vote for such independence.

Ann Winterton: The hon. Lady makes an interesting point. Does she not agree that when the Bank of England was made independent, certain of its previous powers were transferred to the FSA? Does she believe that the FSA has acted in the meantime, as it ought to have done, to ensure that the banks had sufficient reserves?

Diane Abbott: It is an interesting question. Historically, the FSA has not been an effective regulator, and the House will have to return to the matter.
	I want to comment on my Prime Minister's economic war council. With 28 people gathering as a war cabinet for economic crisis, it is very impressive. For my taste, however, it is overbalanced towards investment bankers, hedge fund managers, former investment bankers, and people who would like to work in investment banks when they finally leave politics. I put it to the House that wonderful as investment bankers are, we need a more balanced source of advice if we are to move forward in this financial crisis. Of course they will suggest that we pour money into the investment banks. As many Members have said, however, there are other issues that our constituents will ask us about when we return to our constituencies over the weekend.
	I am still concerned about the situation of parts of local government that have big holdings in Icelandic banks. It is well and fine that investment bankers are happy with the financial rescue package, but if my constituents or those in other parts of the country find that their services or day-to-day expectations of local government are threatened because the Government are unwilling to support local government in this situation, their love for the financial rescue package will start to drain away.
	I was not satisfied by my right hon. Friend the Financial Secretary's answer on the question of repossessions. One of the reasons for our financial problems is the housing bubble in both America and Britain. Ministers need not console themselves that we did not sell sub-prime mortgages. What is a mortgage for 125 per cent. of the value of a house but a sub-prime mortgage? Our constituents will not understand if we can throw billions of pounds at bankers, but can offer people in danger of losing their homes nothing more than the hope that their mortgage holder might be a bit kinder or nicer. We must put in place a practical scheme to make sure that our constituents do not face a rising tide of repossessions while the investment bankers sit back, recapitalised by the taxpayer but under no pressure whatever to resume lending, either to each other or to small business, and certainly under no pressure to have a more long-term and constructive approach to the issue of repossessions.
	The availability of loans for small business has been mentioned. I tell the House that the financial rescue package will soon turn into a joke if small business continues to have its current problems with getting bridging finance and finance generally. The possibility of bringing forward public sector spending on housing was raised yesterday. We have promised £8 billion of such spending; why can it not be brought forward? That would do a great deal for the real economy.
	I believe that the financial rescue package is right and important, but I also believe that there are many other issues about which our constituents will ask us in the coming weeks and months, which will need to be raised and pursued both on the Floor of the House and in Select Committees. One of the most amazing features of today's debate, meanwhile, has been to see the Liberal Democrats trying to occupy a position to the right of the Tories on City bonuses. I have to tell them that not even the City is defending the current City bonus regime.
	We are facing the most serious economic crisis for a lifetime. I hope, as a Back-Bench Member of Parliament, that I shall be able to play my part in the debates and discussions, and I hope that we can arrive at a real and lasting resolution of the crisis in which we find ourselves.

Peter Lilley: I draw the House's attention to my interest, as in the Register of Members' Interests.
	It is a privilege to follow the hon. Member for Hackney, North and Stoke Newington (Ms Abbott). She referred to a speech that she made in a banking debate 10 or so years ago, which is one of the very few speeches from 10 years back that I still remember. It was as distinguished as was her speech today. She was right to say that we face a very serious problem.
	I shall try to be brief in making a number of assertions. The first is that recession is now inevitable, but depression is still avoidable. There has never been a 1930s-style depression when the stock of money and credit has been maintained, and I therefore welcome the measures taken by the Government to prevent the contraction of credit and money that would have occurred if there had not been an injection of public money into the banking system to help recapitalise it. My second assertion is that while it was right to put in public money and take a public stake in the banking system, we should seek to maximise the return to the taxpayers from that money, and maximise the private contribution of new capital to the system.
	Members may find it slightly odd that I should support what is effectively partial nationalisation of the banks, about which the Chancellor of the Exchequer appeared rather sheepish yesterday. In fact, I am the last Conservative Minister ever to have nationalised anything, albeit in a rather different sort of crisis: I nationalised all the Iraqi-owned assets after Iraq invaded Kuwait. In an emergency it is necessary to take drastic action, and it is essential for the Government to prop up the whole structure of credit, which exists only because Government allow fractional reserve credit banking and stand as lender of last resort.
	We need, however, to maximise the return to the taxpayer and maximise the injection of private capital into the banks. I am therefore puzzled that, in terms of maximising the return, the Chancellor of the Exchequer is proposing preference shares rather than convertible preference shares. If he had insisted on convertible preference shares, if and when, as we hope, the banks are restored to health and vigour and the economy likewise, the public sector would have seen a recognition, in the form of a profit, of some of the good that it had done. By failing to make the shares convertible—perhaps it is not too late to do so—the Chancellor of the Exchequer has deprived taxpayers of some of the profit that they could have made. If we had convertible preference shares, he would also be right to encourage the private sector to put in money instead. If the banks would prefer to have private capital coming in on the same terms, they should be allowed to do so. I should like the Chancellor to consider that.
	Of course, there is always a trade-off between the conversion price and the coupon that is paid. However, if that means that a slightly lower dividend is paid in return for a share of the profit at the end, that is a good thing in itself. We want to restore the capital base of the banks by retentions, rather than by paying out dividends, as much as possible.
	I welcomed the Chancellor's statement that he was prepared to help to underwrite private capital injections. If he does so, I suggest that he take up the idea that I proposed last Monday that additional capital put in now should be given privileged status in the event of an eventual bank reconstruction, and not written off in the same way as old capital. That may indeed be what he is referring to when he talks of underwriting the injection of new capital.
	We need to learn the lessons of experience abroad. Some of the best lessons—they involve some of the greatest problems and some of the worst mistakes—can be learnt from the experience of the Japanese, who have undergone a prolonged banking crisis over the best part of 14 years. The lessons there are, I believe, that delay and dithering, a grudging injection of the minimum amount of help rather than help commensurate with the size of the problem, and a piecemeal, bit-by-bit approach, all undermine the impact of any measures that are taken. It is regrettable that we have waited as long as we have before taking this very substantial step, which, as I have said, is one of the Chancellor's measures that I welcome.
	Eventually, the Japanese had to adopt all the weapons available to them: not just recapitalising the banks as we have done and not just injecting liquidity as we are doing, but moving non-performing loans off the balance sheet into a separate institution. I hope that that will not be necessary, but as the hon. Member for Hackney, North and Stoke Newington pointed out, it is a mistake to assume that all bad loans are over in the United States in sub-prime mortgages. There will be bad loans in this country, because many loans are backed by real estate and property values that have fallen dramatically and may fall further, and if we do move into recession many may begin to under-perform for other reasons.

Andrew Pelling: Is not one of the key solutions moving all the bad debts off the banks' balance sheets? The real problem in Japan was a great reluctance to do that, which held the Japanese economy back for many more years.

Peter Lilley: That is exactly the point that I was making. We may have to consider doing likewise, in addition to the things that we have already done.
	The Japanese also had to extend a guarantee to all individual deposits. I find it incomprehensible that the Government have not done the same, although implicitly they are offering to do so; they extended a guarantee to all individual deposits in Northern Rock and Bradford & Bingley, which they have now extended to Icesave, or whatever it is called—the iceberg bank. If they can extend such a guarantee to a foreign and rather dubious bank, it is odd that they should not extend it, for a limited period, to all depositors in this country.
	The final thing that the Japanese had to do was cut interest rates drastically. I agree with my hon. Friend the Member for Chichester (Mr. Tyrie) that the Bank of England needs to recognise that in these circumstances interest rates may need to be cut further and faster than ever before. In Japan they had to be cut to zero. We should not relate interest rates to what was necessary during a period of excess credit creation, given that we are experiencing a period in which there is likely to be excess credit contraction.
	I hope that the Government will not rule out any further measures that are necessary, and I very much hope that the measures that they have already taken will be effective. They will certainly have the support of the Conservatives, but that does not mean that we will not hold them to account for getting us into these problems over the past 10 years. They must accept responsibility for that.

Barry Gardiner: I have only a scarce couple of minutes in which to make my speech. It may shock my constituents that I have sought to address these problems within such a short time scale, but equally I think they would consider it remiss of me not to seek to do so.
	I want to focus on three key problems and on responses to them. The first is reserving policies in insurance companies, the second is the difficulties with rating agencies, and the third is shorting in the market. I then want to look at three other issues: how the Government's proposals deal with pensioners approaching the age where they have to convert their fund into an annuity; local authorities and the need for them to have their funds safeguarded; and business interest rates.
	I have been saying for many years that we need to look at the adequacy of reserving policies in our insurance companies, and I will not on this occasion add to the remarks I have made on the subject over a protracted period. To minimise the risk from the sub-prime loans, companies paid rating agencies to advise how to securitise those bundles and turn them into a higher investment grade. Often, that meant packaging them with an insurance policy to cover the expected rate of default. This was, in effect, the modern version of alchemy—turning base metal into gold. There was a clear conflict of interest, as rating agencies were paid to advise how this process of securitisation could happen when their proper job was to police it. This is one of the key issues that the Government need to address to create financial stability.
	Shorting in the market is where someone promises to sell a stock they do not own in order to drive down its value in the expectation that they can then buy it at a lower price before having to deliver it to the person they sold it to at the higher price. That is how traders make money in a falling market. I call for two further changes. The seller must effect delivery of any shorted stock to the buyer within three days of the original agreement to sell. That will reduce the time in which a speculator can buy at a lower price than the original sale. Cutting this arbitrage window will discourage aggressive speculation by shorting. The second change would be to introduce a rule that allows shorting of a stock only where the price of that stock has actually risen in the pervious trading period—the uptick rule, as it has been called in America. That would make it much more difficult for traders and hedge funds to engage in a concerted and repeated market attack to drive down the price of a particular share. I hope that my right hon. Friend the Financial Secretary will consider these two solutions, and in deference to him I shall give him a couple of minutes to respond to the debate.

Stephen Timms: We have had an interesting and thoughtful debate, and I welcome the broad support for the announcements the Government made yesterday. My responses will inevitably be extremely brief, but I want to confirm that the conditions that will be set for banks benefiting from this package will be tailored to the individual case. They will depend on the level and method of the support that is provided, but they can certainly include lending practices, and I agree with what my hon. Friend the Member for Leeds, East (Mr. Mudie) said about the importance of making sure that home owners and businesses are supported through these arrangements. The conditions can also include dividend payments and bonus arrangements and executive pay. In reaching agreements, any beneficiary will need to satisfy the Government that executive compensation practices are appropriate—
	 It being one and a half hours after the commencement of the proceedings, the motion lapsed, without Question put, pursuant to the Temporary Standing Order (Topical debates).

Charles Walker: On a point of order, Madam Deputy Speaker. Yesterday, the Government announced they were taking £500 billion-worth of taxpayers' money to bail out the banking sector, which failed under their watch, yet today we have had a miserable 90 minutes to debate the consequences. This bail-out alone could cost my constituents in Broxbourne £750 million, the same as constituents in Burnley, Bolton, Barnsley and Bury. How can you help us, Madam Deputy Speaker, to persuade this Government to give Back Benchers from all parts of the House more time to debate and discuss these important matters?

Madam Deputy Speaker: Order. I understand the frustration of Members who have been present in the Chamber today and who wanted to make a contribution. The length of this topical debate is limited to 90 minutes, but I think it is safe to say that this will not be the last time that matters of financial stability are discussed in this Chamber in the next few weeks.

Mark Pritchard: On a point of order, Madam Deputy Speaker. On 8 October, I received a written parliamentary reply to a parliamentary question I tabled to the Under-Secretary of State for Defence, the hon. Member for Grantham and Stamford (Mr. Davies). In that reply, on the sale of helicopters to foreign Governments, I was informed by the Minister that only three helicopters had been sold to foreign Governments since 2002. On a serious point, that contradicts an earlier reply from a previous Armed Forces Minister dated 6 November 2006, in which the then Minister of State said that six helicopters had been sold to foreign Governments. Is it not concerning, Madam Deputy Speaker, at a time when our armed forces need helicopters in Afghanistan and Iraq, that Defence Ministers do not seem to know how many they have sold to foreign Governments?

Madam Deputy Speaker: Order. That is not a point of order for the Chair. The hon. Member has made his point, and Ministers are sitting on the Treasury Bench and will have heard his comments.

Defence in the UK

Motion made, and Question proposed,
	That this House has considered the matter of defence in the UK. —[Ms Diana R. Johnson.]

Bob Ainsworth: I would like to begin by offering my deepest condolences to the families of the 10 service personnel who died over the summer in Afghanistan. We owe them, and all those who have lost their lives in conflict, a huge debt of gratitude.
	As the House will know, there have been changes to the Defence ministerial team over the last week. I am very sorry that my right hon. Friend the Member for Kilmarnock and Loudoun (Des Browne) and my hon. Friend the Member for Halton (Derek Twigg) are leaving the Department. They were both dedicated and experienced individuals, with whom I enjoyed working; they made a huge contribution and I shall miss working with them. That said, we have a new Secretary of State and two new Ministers, whom I am very much looking forward to working with on the challenges that lie ahead. The Secretary of State has asked me to offer his apologies to the House for not being here today. He is making his first foray into international defence diplomacy at the NATO ministerial working group in Bucharest.
	Our focus is understandably and rightly overseas, but we should never forget the enormous contribution the armed forces make at home. I welcome the opportunity to put the spotlight on defence in the UK. On my visits to military bases around the UK, I have seen for myself the pride of our people in what they do. They know they make a difference, and the public know they do as well. According to the latest polling, 79 per cent. of people think the military are a force for good in the world. We need to make sure that this good will is backed up by a level of recognition and reward that stands comparison with the sacrifices that they make on our behalf.
	Defence is, obviously, focused on delivering security. With the current attention on Iraq and Afghanistan, it is easy to forget the many other ways our armed forces provide security through operations at home, such as counter-terrorism and unexploded ordinance disposal. The military provides round-the-clock military bomb disposal teams ready to defuse threats anywhere in the UK, and crack Navy and Air Force search-and-rescue crews stand ready to respond to distress calls at a moment's notice—in 2007 alone, they responded to a total of 1,793 call-outs. Over the course of the last year, Royal Navy fishery protection vessels conducted 1,311 boardings while the RAF maintained the security of UK airspace every hour of every day without failure. Whatever they are asked to do, they do it. Those conducting ongoing home operations deserve our recognition and the nation's thanks.
	When it comes to our defence industry, I can say with absolute certainty that our armed forces stay world class because we have a world-class UK defence industry behind them. The purpose of our defence industry must first and foremost be to deliver capability to the front line, and we are proud of the partnership—in some cases the deepening partnership—that we have with industry to achieve that.

James Arbuthnot: The Defence Committee visited Abbey Wood last week. It was a most valuable visit. We asked the chief of defence matériel who was in charge of the defence industrial strategy, and the answer was that it was not him. Who is?

Bob Ainsworth: At the top level, the answer is the Secretary of State and my new ministerial friend, my hon. Friend the Member for Grantham and Stamford (Mr. Davies), who is the Minister with responsibility for defence procurement. Of course, the chief of defence matériel reports to them on all the issues concerned with the procurement of equipment for our armed forces, so the right hon. Gentleman is absolutely right to say that the chief of defence matériel is not in charge. We live in a democracy, after all, and I thought that the right hon. Gentleman and all Opposition Members understood that point.
	My favourite example of procurement and deployment is the Mastiff vehicle—a piece of kit that soldiers have heaped praise on, and which was taken from the order book to the battlefield in less than 23 weeks, making a big impact on operations in a very short time frame. We need to ensure that we recreate that example again and again: sourcing what our armed forces need, ordering it and getting it out to them in theatre as quickly as possible. However, equally, we cannot take our eye off the ball in delivering for the long term.

Linda Gilroy: Will my right hon. Friend also pay tribute to all those involved in bringing the Jackal vehicle forward as an urgent operational requirement? It is rolling off the production line in Devonport at the rate of, I think, at least one a week.

Bob Ainsworth: That is my hon. Friend's favourite because it is produced in her constituency. I have seen the production line, and it is a very impressive piece of kit that is being brought to theatre in good time. I can understand why she is so supportive of its operation, which is providing jobs in Devonport as well as a first-class vehicle for our armed forces. She will understand why I tend to favour the Mastiff. It is produced in my constituency by NP Aerospace—an impressive and agile company that has responded very well to defence procurement demands.

Philip Hollobone: When we debated these issues before the recess, the vulnerability of the Snatch Land Rover to attacks in Afghanistan was one of the main issues raised by the Opposition. Can the Minister advise the House of any developments over the recess regarding when the Snatch might be phased out of aggressive operations in Afghanistan and replaced with more suitable vehicles?

Bob Ainsworth: Mastiff has delivered a high level of protection for our troops and is very well thought of, but as the hon. Gentleman knows, it is an extremely heavy truck that cannot go into many places, and there is a need for a lighter personnel carrier that can get to the places Mastiff cannot get to. We hope to bring Mastiff 2—yet another tranche of Mastiff vehicles—into theatre by the end of this year. We have ordered Ridgeback, which will come into theatre and is in the process of being up-armoured. However, even Ridgeback, smaller though it is than Mastiff, will not provide the size that Snatch does, so what work can be done on Snatch itself is going ahead, to see whether we can get more power into the unit and therefore more speed, and more armour. That will come through in the form of a new, better-performance Snatch as soon as we are able, but I do not think that we can deprive our commanders—I know that this is a controversial issue in the House—of a vehicle the size of Snatch: not while they are telling us that they need that capability and utility in theatre.
	Getting the numbers of Mastiff that we need into theatre and getting Ridgeback there to provide a smaller alternative will limit the use of Snatch to those areas where it is the only vehicle that can do the job. People need to remember that there is armour in the Snatch, and we cannot go beyond a certain point in terms of the amount of armour put into a vehicle of that size—it is just not possible. There is a trade-off between size and armour capability.
	As I was saying, we need to get new equipment to our forces as quickly as possible, but we must not take our eye off the ball when delivering for the long term. From designing high-tech clothing to building submarines, defence creates or sustains about 305,000 jobs. It is a mark of the stature of our defence industry that the UK accounts for more than a third of the global defence market. During the last financial year, UK-based companies signed contracts for defence goods and services to a value of £10 billion. That demonstrates the amount of money that the sector brings into the UK economy, while maintaining key engineering skills here in the UK.

Julian Brazier: The Minister is being generous in giving way. May I take him back to his earlier answer, in which he made some well-judged points about the difficult trade-off between weight and protection? I draw his attention to the new, blast-resistant materials produced by companies such as Aegis, which are lightweight and work on the principle of absorbing blast rather than reflecting it, as all previous blast materials have done. The Czech army, for example, has already put it on the bottom of relatively light Land Rovers, and there have been some very successful trials, including in this country.

Bob Ainsworth: The hon. Gentleman is right, in that we must stay at the very forefront of technological developments in lightweight materials that can do a job in force protection. What was not possible a year or so ago in terms of the amount of armour that can be provided for a relevant amount of weight may well now be possible. We must therefore look at such developments and have companies that are prepared not only to use them, but to bring them into being quickly, as happened with the Mastiff. Too often, we take too long over procurement decisions. We have to be able wherever possible to bring new developments into theatre as quickly as possible. The enemy will change and the threat will change, so we have to change as quickly and nimbly as we can to stay ahead of the game and keep our people protected.

Nick Harvey: I know that people say that one should never ask a question in politics unless one knows the answer, but I genuinely do not know the answer to this one. The Minister explained where Mastiff and Ridgeback are going to fit in, but will he please explain where Jackal is going to fit in? I was slightly surprised by his response to the intervention from the hon. Member for Kettering (Mr. Hollobone), in which he said that there would be a more or less indefinite role for the Snatch Land Rover. I had rather assumed that it was largely to be superseded by the Jackal.

Bob Ainsworth: Jackal provides an altogether different capability from Snatch. Jackal is a highly mobile, highly armoured reconnaissance vehicle with a level of visibility that provides protection in itself. It is a new form of WMIK—weapons mounted installation kit—rather than the new form of Snatch. As I have said, we are working on the degree to which Snatch can be up-armoured. The main problem is the amount of power that Snatch has and its ability, therefore, to pull the increased weight at anything like a reasonable speed. If we can get more power out of the power-pack, we can put on more armour, and that is being worked on now. We are looking to bring on line the new, up-armoured Snatch, which is being referred to as "the Vixen", as soon as we are able. Jackal has a different capability entirely.

Gerald Howarth: Before the Minister took the interventions about armoured vehicles, he was referring to the extraordinarily successful export record of Britain's defence industrial base. Does he accept that that superb record was achieved in large measure thanks to the assistance of the Defence Export Services Organisation—an institution that was scrapped by the Prime Minister last year? Can he tell the House why, in its new incarnation in UK Trade and Investment, the word "export" has been dropped, and whether, as a consequence, he expects it to be of any use in achieving a similarly successful result for British industry in the coming years?

Bob Ainsworth: I was interested by the furore among Conservative Members at the changes that were made last year. I have followed that through, and whenever I have got talking to people in the defence industry, I have asked them how they feel about those changes, how they have bedded in and whether people are getting the service that they need to continue to do their job. Without exception, all the comments that I have received over the past few weeks, from the many people to whom I talked at the Labour party conference and the people whose factories I have subsequently visited, suggested that the support provided by the new organisation is perfectly acceptable, quite superb and has the potential, through connections with all the trade expertise in the Department responsible for trade, that DESO would not have had. The defence industry does not feel the disappointment that hon. Gentleman suggests, and I ask him to check the facts. I have been checking them because I need, and want, to know the situation, and I have been enormously pleased with the response that I had. I invite him to do the same and to bring his reports back to the House. He might think that people feel let down by the changes that we have made, but that is not what they are saying to me.

James Arbuthnot: I can only say that yesterday I was talking to a senior managing director of a very important defence company in this country, and he agreed with my suggestion that the decision was a thoroughly bad one and was damaging to the British defence industry.

Bob Ainsworth: I could name the people to whom I have spoken, and the right hon. Gentleman could name the person to whom he has spoken. We are being given two different stories; one never knows, perhaps the same people are saying two different things. I have heard no detrimental comments from the people with whom I have raised the subject of the changes that were made. People are saying that they are getting the support that they require and that there is the potential for improved support from the new arrangements. That is the feedback that I have been given, so perhaps we need to continue this conversation with people outside the House—I am sure that we will continue it with people inside the House too.
	British military training is considered to be the best in the world. No other institution in the United Kingdom provides such a broad range of high-quality training and education, which is evident, for example, in our apprenticeship delivery programme. On average, more than 20,000 people leave the armed services each year, and, overwhelmingly, they are better educated, fitter and more highly skilled, and they have a higher level of confidence, a strong work ethic and a team spirit, when they leave—no wonder they are quickly snapped up by employers.
	We still have problems with our training that we need to tackle—for example, bullying is something that the armed forces and the Ministry of Defence will not tolerate. The vast majority of recruits who come through training have a very positive experience, and we act quickly to resolve the issues for the small number who experience bullying or have any other grievance. We are proud of the fact that complaints can now be referred to the completely independent service complaints commissioner, and our training establishments are subject to ongoing scrutiny by external, independent authorities. The nub of the issue is whether we can eradicate bullying entirely and still keep our training sufficiently robust, hard and challenging to prepare young people for the demands of combat. Both the Chief of the General Staff and I think that it is possible to do so, and we are committed to working towards that end.
	As in all areas of defence, we continue to examine how we can improve training. The House is aware of the defence training review programme. The review will transform how we deliver specialist phase 2 and phase 3 technical training on a defence-wide basis, and, once complete, will help us to adjust to changes in demand, to make more efficient and effective use of training personnel, to improve accommodation and to make better and more efficient use of the training estate.

Mark Pritchard: rose—

Michael Penning: rose—

Bob Ainsworth: I am coming to the point on which the hon. Gentlemen probably want to intervene. Hon. Members will be aware that progress on defence training review package 1 has been more difficult and prolonged than expected. However, I can report that considerable progress has been made in driving down costs and towards achieving an affordable, value-for-money package 1, which is on track for an investment decision next spring, with the contract signature to come approximately 15 months later.

Mark Pritchard: As the Minister knows, the defence training review programme is the largest private finance initiative in British history. I hope he agrees that we must get defence training in this country right. Does he share my concern about the reports over the past three or four weeks about the delay in the delivery of that programme—I believe that an announcement will be made today or perhaps next week about a further delay; he just alluded to it—and, more importantly, about the rising costs? Such reports contradict the statement that he just made. The fact is that the costs have increased by £1 billion in the past six months alone. What recent discussions has he had with Treasury Ministers about those rising costs?

Bob Ainsworth: I am aware of all the ongoing publicity about the difficulties, particularly those in defence package 1. I know that the hon. Gentleman is interested in that because of his constituency interest—

Mark Pritchard: And national interest.

Bob Ainsworth: I am sure that the hon. Gentleman has a national interest too, but he has a particular interest in this matter and, obviously, he pursues it. I am not saying that the costs have not changed. I am saying that we still have an affordable package that is far cheaper than the alternatives, and that has been worked on over the summer. We will be able to go ahead with defence package 1 and get value for money out of those proposals.

Michael Penning: The Minister referred to bullying. I agree that the Army, in particular, should do as much as possible about that, but bullying will be there. One of the areas about that I am worried about is recruit-on-recruit bullying, especially among training regiments. Many years ago, when I came through basic training, there were trained soldiers in the barrack rooms during the night. The Minister is aware of that, and I have also raised this issue with the Secretary of State. If one visits a training regiment these days, as I know the Minister has done, one finds that the instructors go home to their families and loved ones, and there are few experienced soldiers in the barrack rooms at night, and the bullying often takes place when recruits think that they are a little more senior. As so many of our armed forces who have received some minor injuries and some serious injuries still want to stay within the military, surely it would be sensible to bring those experienced soldiers back into phase 1 and phase 2 training to provide the sort of mentoring that we need to stop the bullying.

Bob Ainsworth: The hon. Gentleman is obviously right; it is as important, and perhaps more so in some instances, to provide a safe environment in our training establishments at night as it is to do so during the training practice that goes on during the day. A big part of doing that lies in getting the estate right; we need to make the configuration of the training accommodation appropriate to a safe environment. He takes a huge interest in this issue, so I commend him to look around some of the new accommodation that is provided at Pirbright, where there is a safe environment that provides people with oversight during the night as well as during training hours. He knows that bringing the defence estate up to an adequate level—I shall return to this point later in my speech—is a massive project that will still take some time, although building has been going for some time. We need to deal with this issue; we need to get our priorities right; and we need to ensure that we eliminate bullying, no matter where it comes from, be that from instructors or peers. In the process of doing so, we must not lose the rigours of the training regime. If we lose those rigours, we will not turn out the people for the highly dangerous environments in which we expect them to work, to stay safe and to stay alive.
	The armed forces constituency across the UK, including veterans, families and the armed forces, numbers about 10 million people. That broad constituency is part of the fabric of this nation, and enriches life in Britain immeasurably and in a variety of ways. As a Government and a nation, we have asked a great deal of our armed forces recently, not least in Iraq and Afghanistan—and they have delivered. So it is right that we give them all the support and recognition that they deserve. That was the theme of the national recognition study, carried out with his customary skill by the new Under-Secretary of State for Defence, my hon. Friend the Member for Grantham and Stamford who has responsibility for defence equipment and support. He reported in May this year and highlighted a range of ways in which the country can do more to show appreciation and to recognise the huge debt that we owe our armed forces. I am pleased that since that study was launched, we have seen an increase in the number of military parades through towns, as well as a number of other initiatives, such as free tickets to football matches and discounts at cinemas. Individuals are finding their own ways to show their gratitude. That is to be welcomed and appreciated, and it is probably past time that we reached that position.

Bob Russell: I associate myself with the condolences in the Minister's opening remarks. In my constituency, 16 Air Assault Brigade has lost 11 soldiers in Afghanistan. I also endorse his remarks about the proper level of support for our armed forces. Will he or one of his ministerial team visit my constituency to see the married quarters? While the new Merville barracks for the single soldier are the best that can be provided, I have to say that—as a direct consequence of the privatisation of Army housing by the last Conservative Government—the condition of the family accommodation and the play areas, and the inadequate policing now that MOD police numbers have been cut, are causing serious concern. If retention is important—and it is—that issue needs to be addressed.

Bob Ainsworth: I try to get round as many establishments as I can, and I will continue to do so now that Parliament has returned, as I did over the summer. The Whips and parliamentary business allowing, I shall get round to as many establishments as I can, and I hope that that will include the one that the hon. Gentleman mentions. I shall come to issue of accommodation shortly, and I do not think that my comments will be very dissimilar from his.
	Recognition of our armed forces is not enough. Our most valuable asset in defence is our people. The men and women of the British armed forces are person-for-person the best in the world. They provide security for the nation and accept the unique demands of service. Most markedly, they accept the risk of death or serious harm as part of their job. So it is vital that we do all we can, not just within the MOD but across Government, to ensure that those who serve are not disadvantaged by virtue of what they do. This will in some circumstances call for degrees of special treatment for those who need it.
	That guiding principle underpinned the Command Paper launched in July. We pledged more than 40 cross-Government initiatives to improve support to our armed forces community. For example, we are doubling the maximum, up-front lump sum compensation for the most seriously injured to £570,000. That is on top of—although the media too often forget it—a tax-free, index-linked guaranteed income payment, which can take the total value of a settlement to in excess of £1.5 million over the course of a lifetime.
	I was also pleased to see that most of the recommendations made by the Forsyth commission were already in our Command Paper—after all, imitation is the sincerest form of flattery.

James Gray: On the question of compensation, especially for those who have been killed, will the Minister consider the anomaly that those who have been bereaved are not paid that compensation until after the inquest has been concluded, which may be a significant length of time after the death? Is not there an argument for paying compensation to the families immediately after the death, with the higher amount being paid after the inquest is completed?

Bob Ainsworth: The armed forces compensation scheme is for people who are injured, not those who are killed. Separate arrangements are in place for compensation in some circumstances when people have died on service. The armed forces compensation scheme seeks to pay out as soon as is reasonably possible after a proper assessment of the level of injury. The hon. Gentleman will accept that the level of injury may not be immediately apparent, and we therefore need a proper assessment of that before we can compensate the person for it.
	The hon. Gentleman is talking about death, for which we need a process to establish culpability. We have tried, where appropriate, to accept culpability so as not to delay the decision further and increase the trauma of the families of those who have lost their lives.

James Gray: I am grateful to the Minister for giving way, as I did not explain myself clearly. When a member of the services dies, a standard amount—I think that it is £40,000—is always paid to the bereaved family, but it is delayed until the end of the inquest. Could we not pay that standard amount as soon as a death occurs, with any uplift arising from the result of the inquest being paid later?

Bob Ainsworth: I will talk to the hon. Gentleman later and ensure that we are doing what we can. I understand his request, and if our actions are inappropriate, we will seek to address that.

Brian Jenkins: On a similar point, is my right hon. Friend satisfied that the individual and the family are supported appropriately before a compensation settlement is reached?

Bob Ainsworth: The truth is that I am not satisfied and, as my hon. Friend knows, we have done a fair amount of work to try to improve the support that we give to the families of our bereaved servicemen. We have made many improvements and put some resources into that. We have not got it right, because there is more that we can do to offer that support, and we are looking at it all the time. We have sometimes allowed the process to take too long and sometimes we have even caused the delay. That only adds to the upset and the bitterness that families feel when they have lost someone close to them, so we have to improve and do as much as we can. My hon. Friend draws attention to an area on which the MOD must keep working.
	We are now working across Government to implement the promises that we made in the Command Paper. We have formed an external reference group, with members drawn from Government, the devolved Administrations, charities and academia, which will report formally to the Prime Minister, and through him to the public, to ensure that we honour the military covenant not just now, but down through the years. In pursuit of this, we have done much more over the last year to improve the lot of our servicemen and women. We have increased the commitment bonus to a maximum of £15,000 and increased the operational allowance to £2,300, improved the longer separation allowance, and invested in Headley Court to the tune of £24 million. We have extended Defence Medical Services to reservists on operations. We have introduced child care vouchers, achieved better access by service personnel to the key worker living scheme, arranged free post at Christmas for parcels, awarded above-inflation pay rises and brought in council tax relief for those on operations.
	We plan to do more in the future. We are establishing a military ward in Birmingham's new hospital and rolling out the community mental health services for veterans. For families, we are disregarding compensation payments for the means test on home adaptation grants, providing additional accommodation for service leavers at risk of homelessness and removing disadvantage when it comes to access to schools. We will give service leavers with more than six years in the forces their first A-level course or even a degree course with no tuition fees. We will extend concessionary bus travel to seriously injured personnel and veterans.
	Our initiatives have led the Royal British Legion to say:
	"The Covenant is being brought back into balance".
	That is all a far cry from the bluster and hyperbole of the Forsyth commission. The commission's report was 40 pages long and made no real commitments—well, they were few and far between. It was a huge retreat from the commision's interim report and it deservedly sunk without a trace.

Tobias Ellwood: I do not want to get into the debate about the Forsyth commission, but it mentioned the importance of Headley Court, which was mentioned by the Minister, and I think that the whole House would pay tribute to the hard work that takes place there. Questions were raised about the swimming pool, which is an important part of the rehabilitation process. Will the Minister use this opportunity to update the House on what is happening about the advent of a swimming pool as a facility at that location?

Bob Ainsworth: The hon. Gentleman knows that the money was raised by Help for Heroes and that they have now completed that fundraising. There is no reason from a finance point of view for any delay, and just the detailed work—such as that to do with regulations—and the construction work needs to go ahead in order to provide a swimming pool at Headley Court. The Government are providing £24 million to secure the development plan for Headley Court over a 10-year period, providing all the other rehabilitation facilities that are needed.
	I hope that the hon. Gentleman would agree that although people sometimes say that we should not rely on charity, it is important not only that we fund the facilities adequately as a Government through the taxpayer but that we attract and encourage charitable contributions. Help for Heroes has done an amazing job to fund the swimming pool at Headley Court. That organisation and others, such as the Royal British Legion and the Soldiers, Sailors, Airmen and Families Association, ought to be congratulated and nurtured. They ought to be helped to continue to make the fantastic contribution that they make.
	Accommodation was one of the issues addressed in the Command Paper, and I would be the first to admit that not all our accommodation is what it should be. After decades of under-investment in the defence estate, the Government have built or upgraded more than 29,000 units of single living accommodation since 2003 and upgraded nearly 13,000 service family homes since 2001. We will invest a further £8 billion in service accommodation over the next 10 years.
	In the Command Paper we also pledged to improve access to the property ladder for our people and for those leaving the forces, so I am pleased to tell the House that there is a team working on proposals to address those issues that will report by the end of the year. The Prime Minister has already announced a £20 million pilot scheme to promote home ownership, which is to be launched in 2009.

Bob Russell: Will the Minister confirm that all that public money is being invested in housing stock owned by a company that acquired Ministry of Defence housing in 1996, privatised at a price way below its value? In 10 years, the Government have spent more money in rent than the previous Government received in capital receipts, and all that public money is further enhancing the property value of Annington Homes rather than benefiting the public purse.

Bob Ainsworth: The hon. Gentleman is right that the deal that was done by the previous Government has left us a legacy that we have to work with. The overwhelming majority of our service family accommodation was sold off and we are now renting it back from Annington Homes. The money was taken and most of it did not go into the defence budget; it was taken by the Treasury before the 1997 general election. However, we have to live with the circumstances as they are. We have to work with Annington Homes and with anyone else who can help not only to improve our accommodation but to provide opportunities for our service people to get into home ownership. Despite some of the difficulties in the housing market in this last year, that is an aspiration that most of our people have and we must do as much as we can—with Annington Homes or with anybody else—to try to meet that aspiration.
	Opposition Members are not short of words on what more we need to do to look after our armed forces, but it is this Labour Government who have actually delivered for our forces. We have provided better equipment, better pay, more compensation, and improved health care. We have upgraded accommodation, which the Opposition sold off. We do not talk about what needs to be done; we get on and do it. Everything that we have debated—accommodation, support, training and pay—has an influence on recruitment and retention.
	The latest figures on recruitment give some encouragement. There has been an 11 per cent. increase in the number of new recruits joining the forces in the 12 months up to June 2008, and there has been a 12 per cent. increase in the number of recruits joining the trained strength. The number of people leaving the trained strength has fallen by 1.4 per cent. in the past 12 months. On 1 August 2008, the full-time trained strength of the armed forces was 173,470, against a target of 179,160. That is 96.9 per cent. of the requirement.
	Hon. Members will be aware that our people are working very hard, and some are deploying more frequently than any of us want. Obviously, that is not ideal, but the service chiefs have said that the current situation is manageable. For a number of specific groups in each service, including the Royal Marines ranks, the Army infantry, and RAF firefighters and engineers, manpower shortages create significant pressures. Measures to reduce those shortages include recruiting bonuses targeted at shortage areas, re-engagement bonuses, restructuring to spread the load more evenly and an enhanced operational welfare package. There is still some way to go before the situation is fully rectified, but we have made progress and will continue to do so.
	A last word on harmony: as we move to a new role in Iraq, harmony will improve. I do not want to get into a debate on exactly when that will be; suffice it to say that in the medium term the decrease in our military commitment in Iraq will considerably ease the current stretch on our armed forces.

Tobias Ellwood: I am grateful to the Minister for giving way a second time. About three weeks ago, I had the opportunity of visiting Afghanistan and listening to concerns about the Apache aircraft. As many of us will be aware, the concern is about a shortage not of aircraft, but of pilots. That came through loud and clear. We have 67 Apache aircraft. We could send them all out there, but they would not fly, because there are not the crews to man them. That message must be driven home. What is the Minister doing to expedite the training of crews, so that more of the Apache aircraft that are sitting dormant, or being used for training purposes in the UK, can be shipped over and used in Afghanistan?

Bob Ainsworth: We need to watch closely our ability to recruit and retain pilots, among other groups. I refer not only to helicopter pilots, but fixed-wing aircraft pilots. There is—or has been in recent years, in any case—a very buoyant civil aviation industry that pulls our people out earlier.

Tobias Ellwood: So what are you doing about it?

Bob Ainsworth: I have reeled off a list of things that we have done to try to address the recruitment and retention needs of our armed forces. The Government will keep them under review and will respond to the needs as and when required. We have done that, and will continue to do that.

Julian Brazier: I am grateful to the Minister for giving way yet again. There is not a single class of helicopter used by the US armed forces that does not have reservist crews, many of whom work in the dynamic aviation industry that he mentions. The US armed forces are able to rotate those reservist crews into operational theatres without moving the machines; the guys just fly out and take over the machines that are over there. Surely we should expand our aviation reserves, and not, as is planned, reduce both the Royal Naval Reserve and the Army aviation reserve.

Bob Ainsworth: I was about to move on to the issue of reserves. As the hon. Gentleman knows, we have commissioned a study about how best to use our reserves.
	Based at nearly 400 locations across the UK, our reservists create and maintain important links between the armed forces and the wider community, in addition to making a huge contribution to current operations. Since March 2003, more than 17,000 reservists have served on operations around the world. They make up 9 per cent. of British armed forces in Afghanistan and 4 per cent. of our forces in Iraq. They are a significant part of our front-line capability, and in every way a force for good. They not only add power and expertise to our regular forces, but take the skills and abilities that they learn in defence into their civilian roles, adding to our front-line capability as well as our economy.
	Since April this year, we have been conducting a strategic review of reserve forces, and the report to the House is due later this year. The aim of the review is to shape reserve forces so that they can better support front-line operations now and in the future. The hon. Gentleman has co-operated with that review; I know that he is hugely interested in the reserves. His points about niche capabilities and whether we can use the reserves to a greater degree will be taken into account. We will seek to expose those issues in the reserve review and exploit the capability out there.
	I want to remind the House that across the UK there are about 132,000 cadets and 26,000 adult volunteers. Cadets belong to one of the largest youth organisations in the UK, second only to the scouts. Cadet schemes offer our young people a broad range of experiences and are recognised for giving young people ability in leadership, self-confidence, a "can do" ethos and resourcefulness.
	Defence keeps our nation safe. It also adds value to our economy and invests in our people, and I have mentioned only some of the ways in which it is doing so. It is evident that we owe the armed forces credit not only for maintaining our security through operations overseas but for all that they do for us at home. The Government will remain committed to ensuring that service personnel, veterans and service families get all the recognition and support that they need. They deserve no less.

Julian Lewis: I join the Minister in paying tribute to the 10 service personnel who lost their lives on operations. I also wish to remember the larger numbers who have been seriously injured on those same operations.
	Service welfare in the United Kingdom is always among the issues raised in debates such as this. Previously, the hon. Member for Halton (Derek Twigg) dealt with that topic; he was a humane and assiduous Minister, and we wish him well following his departure from Government. In his place is the hon. Member for North Durham (Mr. Jones), who has put his name to robust Defence Committee reports that have rightly described some single living accommodation as appalling and have rightly deplored operational overstretch and the consequent failure to meet harmony guidelines; it will be interesting to see how he gets on in addressing those issues.
	Joining the ministerial team at the Ministry of Defence as an additional member is the hon. Member for Grantham and Stamford (Mr. Davies), in the latest twist of an eventful parliamentary career. He takes over the defence equipment and supply portfolio. In its last two incarnations, that has been held by Lord Drayson and Baroness Taylor, Members of the upper House—perhaps the hon. Gentleman is hoping that a trend in that direction is being established. The hon. Gentleman has always been intellectually independent, grounding the positions that he takes in considerable historical knowledge.
	The hon. Gentleman shares that quality with the new Secretary of State for Defence, as I discovered last year in the national archives when I looked up from my researches into counter-insurgency and propaganda to see him immersed at an adjacent desk in the records of the Lancashire pals' battalions, on which he was writing a book. At least we know that the Secretary of State, unlike some other prominent parliamentarians, actually writes the books to which he puts his name. Referring to the leader of his party, of whom the Secretary of State is such a well known admirer, they do, however, have one important factor in common—they both have important shipbuilding industries in their constituencies. Barrow is the home of UK submarine construction, and it will be interesting to see how many of the eight attack submarines promised by the Government in 2004 will be ordered and built there.
	The outgoing Secretary of State, the right hon. Member for Kilmarnock and Loudoun (Des Browne), deserves credit for his promotion of the case for the next generation of the nuclear deterrent, which was not an easy thing for him to do in the context of Labour party politics. Many Conservative Members often challenged him on other issues, but he always responded without rancour. It was his misfortune to fall victim to the Prime Minister's ill-judged decision to lumber him with a second ministerial portfolio at a time when the country is involved in two counter-insurgency campaigns abroad and a significant security issue at home. Every working minute of the Secretary of State for Defence should have been focused on those threats and the service welfare and procurement issues that traditionally hamper the conditions and capabilities of our forces in the field. It was not fair to the right hon. Gentleman, and it certainly was not fair to our forces in the field, that he had to spend up to 20 per cent. of his time on Scottish affairs. Never before has a Prime Minister taken such a half-baked, ill-judged and morale-sapping decision on parliamentary job sharing. Where United Kingdom defence is concerned, it must never happen again.
	Listening to everything that the Minister said about service welfare, I was reminded of the famous American film, "The Best Years of Our Lives", which won seven Oscars in 1946 and had tremendous resonance with the public, both in America and in the United Kingdom. It was about the problems of re-entry into society at the end of four years of war, in the case of the USA, and six years in the case of the United Kingdom. Our servicemen and women face that problem of disconnection and reintegration into society at the end of every six-month tour. The harmony guidelines are supposed to give them 18 months between operational deployments, but we all know that that does not happen.
	Viscount Slim, the victor of Burma and one of the greatest modern strategists the British Army has seen, once did a radio talk in which he compared people drawing on courage with drawing on a bank balance—although I do not think that he had the modern conditions of British banking in mind. He said that they could overdraw from time to time but must replenish their resources. He also said that the bravest men would crack if they were not rested adequately, and yet, conversely, men who were exhausted but were rested adequately could go back and win the highest awards for valour.
	Last night, I viewed a recording that I had made of a BBC3 programme from two days ago. It was about a lance-corporal in the Grenadier Guards who was described by his company commander as, "Fearless, occasionally to the point of recklessness, but a very brave young man." The Army deserves great credit for allowing the BBC access, in Afghanistan and back home, to what was going on in that company. The BBC likewise deserves credit for its sensitive and objective presentation. The young lance-corporal ended up, on the self-same day, being congratulated on the mention in dispatches that he had been awarded for heroism under fire, and losing his rank for disciplinary offences that he had committed on his return home. He had done four operational tours in his five years in the Army—so much for the harmony guidelines. When service personnel return to the United Kingdom, they need understanding, support and conditions of accommodation that reflect the regard in which they are held by society. Great improvements have been made for those damaged in body, but not enough yet for those damaged in mind, particularly those who could become damaged in mind when subjected to inadequate facilities and unnecessary pressures on their return to the UK.
	The lance-corporal I referred to has now left the Army, but I know of another who aims to serve his full 22 years. He took part in the initial campaigns in Iraq and Afghanistan, and he has since done a third tour lasting seven months—not six—in Afghanistan. Now back in the UK, he has spent time in the Browning barracks in Aldershot, where the toilet blocks stink even when the lavatory pans are not blocked with sewage, and where the corridors are overheated whilst the rooms are freezing cold. His weekend get-you-home pay is supposed to give him £270 per month. Sometimes it is paid when it should be, but sometimes nothing comes through for three months at a time. That unevenness causes him, often unwittingly, to dip into the red, and thus incur punitive charges on every direct debit and every other transaction on his bank account.

Kevan Jones: I am sad to hear about the case to which the hon. Gentleman refers. Would he send me the details of it, so that I can take it up?

Julian Lewis: I am delighted that the Under-Secretary is getting off to such a good start. I shall certainly do that, and I will be very pleased to see if he is able to do something to put that situation right. My point is that bank charges of that sort are irrecoverable. The man in question has not complained to me about it, but his partner has. She said:
	"It eats away and eats away at you—until you say, why the hell am I bothering?"
	The welfare of our armed forces personnel is not really at issue between the parties. The Government, as we have heard, produced a study and a Command Paper. I hoped that the Government would acknowledge today that pressure from the Opposition parties encouraged them to take some of the measures that they have. My party leader has consistently recommended tax concessions for service personnel when they are on the front line, and he set up the Forsyth commission on the military covenant, which achieved a considerable measure of publicity for its recommendations. It slightly lowered the tone of the debate for the Minister of State to say some of the things he said about a body on which served people of the calibre of Simon Weston and Stuart Tootal. Those people are not party political. They served on the commission because they wished to do good for their comrades, and I am very disappointed about some of the remarks made about their efforts.

Julian Brazier: Interrupting my hon. Friend's excellent remarks, would he like to put it on the record that several of the recommendations in the commission's interim report have since become Government policy?

Julian Lewis: Of course they have. The Minister says that most of the things in the commission's report were already going into the Government's report. We can argue about that until we are blue in the face, but we ought to be above such a tit-for-tat approach. The fact is that the Government have the responsibility to do things, and the Opposition have the responsibility to try to get them to do things, and when the process works as it has in this case, it ought to reflect credit on the Government and the Opposition for doing their respective jobs.

Linda Gilroy: I know that the hon. Gentleman is in many respects a very fair person, and that he would want to pay tribute to the British Legion for its part in bringing about some of the changes. Pressure has come from all quarters. Does he agree with his fellow shadow spokesperson, the hon. Member for Woodspring (Dr. Fox), who as recently as 14 September said, of the few things identified as extra in the Forsyth report, that as far as the Conservative party is concerned:
	"It's a matter of priority within the budget".

Julian Lewis: Of course, all defence decisions are matters of priority in the budget. The report's recommendations will go to the shadow Cabinet in due course and I hope that it will consider favourably at the appropriate time those that are possible to advance under prevailing economic circumstances, which the Government have not yet taken up. As I said, the process is the outcome of the interaction between the Government, the Opposition and, as the hon. Lady rightly reminds me, all the important bodies, organisations and confederations that support the armed forces. The outcome should be improvements for our service personnel, and politicians should not argue over the spoils of who gets the credit, as long as the outcome is good.
	We welcome it when the Government introduce their ideas and when they include some of ours among them. We will continue to welcome that when the parties' roles are reversed—hopefully in the not-too-distant future.
	From time to time, we read about servicemen in uniform being insulted at petrol stations or servicemen out of uniform not being allowed to book into hotels. I applaud the former Under-Secretary, the hon. Member for Halton, who described it as "deplorable" when an injured paratrooper, who had flown home from Afghanistan to organise a comrade's funeral, had to sleep in his car overnight because he was refused a hotel room. The hotel's behaviour was absolutely despicable, and I am encouraged by the Minister of State's comments about the 79 per cent. support for our armed forces among the public at large. Long may that support endure. However, it cannot be reiterated too often.
	I am glad that "welcome home" parades have begun to take root in society generally. My hon. Friend the Member for Aldershot (Mr. Howarth) organised one of the first, and parades now take place in the heart of Westminster and returning troops are welcomed in the Palace of Westminster. I am sure that that gives them an experience that they fully appreciate, and that they feel that it shows that all their efforts have been recognised at the centre of our democratic system.

Michael Penning: I thank my hon. Friend for his generosity in giving way. The all-party Army group organised the parade to which he refers, and it was fantastic to see the band of the Coldstream Guards marching from Wellington barracks. Does my hon. Friend know that, before the troops entered the gates, they were attacked by members of the so-called peace camp across the way? They got into the ranks of the soldiers and swore at and abused them, and there were not enough police to prevent that.

Julian Lewis: First, I pay tribute to my hon. Friend and my hon. Friend the Member for North Wiltshire (Mr. Gray), who organised the occasion. I am indeed aware of the matter, which has been raised on the Floor of the House previously. Although Parliament is ready to tolerate the presence of demonstrations in Parliament square, the idea that people should be able to camp there permanently and behave insultingly towards those who put their lives at risk shows a cock-eyed sense of values in our society today.

James Arbuthnot: Most unusually, I want to disagree with my hon. Friend. He said that he hoped that the level of 79 per cent. support would endure, but that figure says something worrying about 21 per cent. of the population. I pay tribute to the new Under-Secretary of State for Defence, the hon. Member for North Durham (Mr. Jones), for his work on support for our armed services. However, I will begin to feel satisfied when it reaches 99 per cent.

Julian Lewis: I fully take the reproof from my right hon. Friend. He is absolutely right on that point. Of course, we are not sure how many people in that poll did not express an opinion. I hope that a lot less than 21 per cent. did not have a positive view of the armed forces. Indeed, a considerable proportion might have had no view at all. There will always be some people who have no view about anything whatever, and I suspect that their views about the armed forces are no exception, strange though it may seem.
	Resources have been mentioned briefly, but I wish to spend a little more time on them. There are some problems, such as erratic allowance payments, to which I have referred, which are not about resources, but all too many are. I return, as I have on a number of other occasions, to the speech that the former Prime Minister Tony Blair made on HMS Albion in early 2007. He was looking back on his decade in power and talking about the extent to which the Labour Government had invested in defence. He said that defence expenditure had remained roughly constant over that decade, at 2.5 per cent. of gross domestic product, before adding these fateful words: if the costs of Afghanistan and Iraq are included.
	That means that in that period, in which we embarked on two major counter-insurgency campaigns, we were spending 2.5 per cent. of GDP before we went into Afghanistan and, taking everything together, we were spending 2.5 per cent. afterwards. We were spending 2.5 per cent. of GDP before we went into Iraq and, taking everything together, we were still spending 2.5 per cent. after we went in.
	We are told time and again that those conflicts are being funded from the Treasury reserve, but that simply sounds to me like a bookkeeping exercise. If we take one pot of money, add it to another pot of money and still come up with the same percentage of GDP being spent on defence as before we went to war, that effectively means that we are fighting two conflicts on a peacetime defence budget.
	That is why the Conservatives have said that when we take power, we will have a strategic defence review, to get our commitments back into line with our expenditure. I do not know what the conditions will be when that time occurs. However, I do know that we will fully fund the commitments that we undertake or we will not undertake them. That has not been happening, which has lead to something that is dangerous for the defence of the United Kingdom and British interests more widely. That development has led to the services beginning to fight among themselves for inadequate resources. Indeed, it is even leading to a situation in which service chiefs are talking about making unacceptable choices, even within their own service parameters.
	What I mean by that is that one cannot be involved at a high level in any considerations of what the Army's future role will be without hearing people talk about whether we should spend the money that we have on fighting what are called the wars of the 21st century or on preparing for high-intensity state-on-state conflict, which may or may not come about in the years ahead. Those are the sorts of choices that the Army should not have to make.
	I do not want to stretch the terms of the debate too much, but it is dangerous to be in a situation where we are engaged in campaigns that are making Army chiefs think that they might have to abandon the traditional role of the Army, which is to be able to defend the United Kingdom if ever the international scene darkens closer to home. With recent events involving Russia, that is not nearly as fanciful a prospect now as it might have seemed only a year or two ago.

Julian Brazier: I am most grateful to my hon. Friend for giving away. He is making some powerful remarks. Does he agree that the Falklands war, the first Gulf war and 9/11, which led directly to the Afghanistan conflict, were all completely unanticipated, in most cases even days before they happened and certainly months before?

Julian Lewis: Absolutely. Now is not the time for me to go back to one of my favourite themes, the folly of the 10-year rule, which was in place from 1919 to 1933, when defence planning was carried out on the basis that there would not be a war in the next 10 years. We all know what that led to. It is in fact an exception for a state-on-state war to have been predicted a significant amount of time before it breaks out.

Linda Gilroy: Will the hon. Gentleman give way?

Julian Lewis: I would rather not at the moment, because I am conscious that we have only a limited time for the debate, and I do not want to speak for too long. Also, the hon. Lady has had one go.
	Moving on to the defence industry base, I should like to point out that Lord Drayson's welcome return to government would perhaps have been a little more welcome if he had returned to the defence procurement field in which he was doing rather well when he felt it necessary to leave government. One can only speculate as to whether he was not invited back to that position, or whether he decided that he did not want to return to it for the same reasons that he decided to leave in the first place. I do not think that that decision was entirely to do with motor racing.
	The defence industrial base is of great value to the economy. Of course, there are traditional problems relating to procurement, which I do not have time to go into in any detail today. However, I would like—in a constructive way, I hope—to take one case study as an example of the sort of thing that Ministers should be thinking about in relation to our shipbuilding industry.
	We know that the Government started out with a commitment to build 12 new destroyers. The number then went down to eight, and it has finally been settled at six. We know that the 1998 strategic defence review lowered the number of frigates and destroyers from 35 to 32. The number then went down to 31, then to 25. It is now down to 22. We also know that Admiral Lord West, when he was chief of the Navy, said over and over again—rather courageously, I thought, as he was still in office—that the Royal Navy needed about 30 frigates and destroyers to discharge its tasks. If we are going to have only six Type 45 destroyers, we are going to need something of the order of 24 new frigates. It will be very hard to persuade the Treasury to finance that.
	Believe it or not, I think that Defence Ministers—even in a Labour Government—actually want to get the best possible deal for the armed forces, just as defence spokesmen in the Opposition believe in the very same thing. I urge Ministers to urge the naval designers, the admirals and the Ministry of Defence, when they are designing the future surface combatant, to make the vessels as basic and economical as possible, and to get as many hulls as possible into the water. They should not make the mistake, which has so often been made in the past, of upgrading the specification over and over again, with the result that we end up with half the number of ships that we originally intended to have.
	It is much more possible to achieve these aims in this day and age than it was in the past. Our naval shipbuilders—and, to some extent, aircraft designers—have now developed techniques that enable them to put a vessel into the water, or an aircraft into service, with spare capacity. Everyone knows that there is a rather large gymnasium on the Type 45 destroyers. Everyone also knows that, as and when the Government can afford it, they will acquire tactical Tomahawk missiles that can be inserted into that spare space in the destroyers.
	There is another reason why the new frigates should be designed to be as basic and economical as possible, and that as many as possible should be built. It is not only to keep the shipbuilding industry alive, or to maintain the necessary number of hulls that everyone knows the Navy needs for escort vessels, but to give us a chance to export the vessels in their simpler form to other countries. When we build vessels at the top of the range from the outset, they are unsaleable to anyone else.
	I wish to conclude my remarks as this is a truncated debate. I am well aware that the two conflicts abroad not only place pressure on our domestic situation, but do not exist in isolation. I alluded to the security threat at home, and the fact is that Government machinery has not kept pace with these matters. Last year's debate on defence in the UK took place on 26 April and I welcomed the creation of the research, information and communications unit, which will be taking steps to try to get the message right about the threats to the UK that arise domestically, but which are interconnected with the campaigns we are waging abroad.
	The trouble is that the machinery is still not properly co-ordinated in the sense that individual Departments are trying to defend the UK in individual stovepipe arrangements. The nearest thing we have to a security Minister is someone at Under-Secretary of State level, with primary emphasis being laid on the Home Office and local government departments. We face integrated and interconnected threats in the UK and abroad, and we need a national security strategy and appropriate machinery to implement it. That is why Baroness Neville-Jones has a seat in the shadow Cabinet as national security adviser. Under an incoming Conservative Prime Minister, she would hold that post and be at the head of an organisation—a national security council—that was truly cross-departmental.
	I want to say a last word about communications. This is not a debate on defence in the world, but when we read headlines at home that Army chiefs are saying such things as, "The war cannot be won in Afghanistan," it is easy to say that the Army chiefs ought to be more careful about what sort of words they use when they are discussing concepts that are nothing new at all. In reality, however, there is also a responsibility on journalists not to sensationalise things that are simply common sense.
	Let me give a brief quote from the internal report produced at the conclusion of the 38-year Operation Banner—effectively the counter-insurgency campaign, if I may use that phrase, in Northern Ireland:
	"Security forces do not 'win' insurgency campaigns militarily; at best they can contain or suppress the level of violence and achieve a successful end-state. They can thus reduce a situation to an 'acceptable level of violence'...What is required is a level which the population can live with, and with which local police forces can cope."
	I have put it another way when talking about these problems: in counter-insurgency, the enemy has to be identified, isolated and, so far as is possible, neutralised; but at the end of a counter-insurgency operation there always has to be negotiation with part of the enemy—the part that has been forced to recognise that it is not going to win and that is pragmatic enough to reach a settlement. I do not believe that anything that has been said about this by the Army differs in any way from that traditional approach.
	I also believe that it is important that the media realise their responsibility; when our military chiefs are making perfectly sensible comments, they should not be turned into headlines saying, "Our efforts are doomed." On the contrary, our efforts are not doomed. The purpose of our efforts is to make the enemy see that they cannot win so that, eventually, the more sensible elements of that enemy can be brought into the political process.

Tobias Ellwood: My hon. Friend is making a powerful statement about one reason why we are spending so long in Afghanistan. Does he agree that the other aspect is the fact that our military is being asked to do far more than it was sent in to do? I now learn that it is working on counter-narcotics, which is far distant from what it set out to do. Most importantly, not enough reconstruction and development are happening under the security umbrella that it creates.
	The situation is dangerous. The Department for International Development and the non-governmental organisations that are supposed to be operating are absent, and the international security assistance force is taking on all those tasks which are used to win over hearts and minds. That will, I hope, allow the locals to strengthen themselves and eventually allow us to go home.

Julian Lewis: I endorse entirely my hon. Friend's comments, and I pay tribute to him for the interest that he has taken, at no small risk to himself, to ensure that he was closely acquainted with that campaign. In particular, if the environment is too dangerous for DFID to operate in, as it is, and if we are asking the armed forces to do more reconstruction, as we are, ought not the Government to consider taking some of the resources currently allocated to DFID and giving them to the armed forces to do the job?

Mark Pritchard: Does my hon. Friend agree that the Government of Pakistan need to do all that they can to ensure that al-Qaeda does not link in with the Taliban, so that those parts of the Taliban that are prepared to negotiate, to which he perhaps alludes, are fit and able to do so at the earliest opportunity?

Julian Lewis: My hon. Friend is exactly right. As has been seen to happen as a result of the successful American grasp of counter-insurgency principles in Iraq, we will end up with a situation in which people who were formerly fighting against us accept that they will eventually get their country back, providing that they break with and eliminate the unacceptable elements. We have seen that at the end of all sorts of counter-insurgency campaigns, both those that have been fought to a draw and those that have been fought to the advantage of the Government side. Ultimately, we isolate the militants and recruit those who are perhaps of a more nationalistic than militant persuasion. We end up with a compromise, which is at the heart of most democratic, and certainly all counter-insurgency, solutions.
	Defence in the UK certainly involves support for the armed forces and for the defence industry, but it also involves support for the cause for which our service personnel are fighting. While civilians talk, debate and write reports, soldiers take their lives in their hands day in and day out. We owe it to them to articulate the cause for which we ask them to fight, and to give them the backing here in the UK when they come home from their dangerous operations.

Mr. Deputy Speaker: Order. Before I call the next hon. Member to speak, may I say to the House that a 15-minute limit on Back-Bench speeches applies from now on? Clearly, time is running out, and a lot of hon. Members are seeking to catch my eye. Therefore, if hon. Members can take less than their allotted time span, it would be most helpful not just to me but to other colleagues.

Alison Seabeck: I am delighted to be able to participate in this debate following a year of silence as a Government Whip.
	First, I pay tribute to those service personnel who have lost their lives in the past year, and to those—some of them severely wounded—who are recovering and trying to rebuild their lives. Some of them are my constituents. That is why the recent publication of the Command Paper setting out clearly what the covenant means, and significantly enhancing it, has been welcomed in my constituency by service personnel and their families.
	However, I very much hope that the decisions relating to the increased payments set out in the armed forces compensation scheme are handled swiftly as well as realistically. There has been more than one example locally of service personnel who have suffered the loss of multiple limbs—two or three limbs—and serious trauma still not being considered for a maximum payment, or near-maximum initial payment, which has at times been difficult for people to understand. I noted the Minister's comment that the MOD has not always got it right in some cases.

Kevan Jones: As I said to the hon. Member for New Forest, East (Dr. Lewis), if my hon. Friend has specific cases that she wants me to consider, please will she feed them through to me and I will look at them?

Alison Seabeck: I thank my hon. Friend. My understanding is that the British Limbless Ex-Service Men's Association has been lobbying hard on specific cases, and I can follow up with that. It was delighted by the Government's announcements generally, but it still has concerns, and would welcome further guidance on the new scheme. I wanted to raise those concerns before proceeding to the main thrust of my speech.
	The defence of the United Kingdom, and the associated industries and service personnel that support it, are essential to a city such as Plymouth, with its long and distinguished military links. Plymouthians are acutely aware of the demands placed on servicemen and women and their families, acutely aware of the risks that they take, and acutely aware of the wider importance of our industrial base and the budgetary pressures faced by the Ministry of Defence. As a result, they value and understand the nature of the work that is required to ensure that the country is kept safe and secure. My constituents none the less have concerns, which I should like to raise. I do not apologise for focusing, rather parochially, on Plymouth rather than raising wider strategic issues.
	On the MOD website, Members will find three statements of aims: to be fit for the challenge of today, to be ready for the tasks of tomorrow, and to be capable of building for the future. How can Plymouth, as part of the United Kingdom defence infrastructure jigsaw, help and be assisted to meet those aims and requirements? There are—not least in the current climate, and given our commitment to operations around the globe, particularly in Afghanistan and Iraq—heavy demands on personnel and budgets. In addition, the MOD is committed to finding value-for-money savings—some £2.7 billion—which are expected to be reinvested in defence. In the light of those heavy pressures on budgets, it is not surprising that Plymouth has been facing uncertainty about the future of both the naval base and the size and role of the industrial set-up within the dockyard. That is not good for my constituents, and I do not think that it is good for United Kingdom defence or for the Royal Navy and Royal Marines based in and around Plymouth.
	Rather perversely, that uncertainty has been running in parallel with huge increases in Government spending in the dockyard on its facilities, nuclear and non-nuclear, and on the residences used by the Navy, as well as on the commercial purchase of the industrial interest by Babcock International. Babcock is continuing to grow, with revenue increasing by 57 per cent. in 2007-08. That makes it one of the leading suppliers of support to the Royal Navy, and we welcome its presence in the city.
	Investment in the naval base has also included the replacement of some grim living quarters by two brand-new buildings that house over 1,600 personnel: 961 junior rates, 450 senior rates and about 250 officers. That is significant, and certainly reinforces the MOD's comment in response to the 15th Select Committee report on defence estates that
	"good quality housing is a fundamental part of the welfare package"
	that it gives service personnel.
	That investment has made a difference in Plymouth, but I should like to hear from the Minister, in the light of ever-increasing energy costs and wider climate-change concerns, how much emphasis is placed on ensuring that all new build in defence estates—accommodation and other types of building—meets the highest energy efficiency standards. The potential cost savings to the Department cannot be insignificant. I hope that the Minister will tell us that when contracts and tenders are being drawn up, the Department will, as part of its procurement process, set the highest standards to ensure that all its partners keep their energy use as low as is feasible, given the nature of the technology used. I should welcome his comments, but I hope he will not simply say—as is said in another part of the MOD's website—that the MOD compares favourably with other Departments. I do not think that response is good enough, and I hope that the Minister can offer something a bit more positive and specific.
	I suppose that all the improvements we have seen in the dockyard should have sent a signal to all involved that there was a real commitment to it on the part of all the major players. However, that is not how they were perceived, and when the naval base review was set in train and there was talk of surface work being removed from Plymouth, a few hares were set running. In response to the ongoing indecision about the dockyard's future, my hon. Friend the Member for Plymouth, Sutton (Linda Gilroy)—whom I am delighted to see in the Chamber—set up a dockyard strategy group, drawing in all the city's leaders, trade unions and Members of Parliament, as well as the regional development agency and other concerned parties, to ensure that Plymouth's concerns about the future direction of United Kingdom defence and our part in it were clarified and the future of our work force was assured. The strategy group knew that Plymouth was "fit for the challenge of today", but we needed to be sure that we were "ready for the tasks of tomorrow", and that we could sustain the skilled work force that was required to meet those demands.
	On the industrial side, Babcock operates very efficiently—as did its predecessor, DML—and for that reason it has continued, in a difficult economic climate, to win a steady stream of orders. In the last year, we have also seen major work, including the completion of HMS Victorious, which has already returned to sea after her three-and-a-half year refit. HMS Ocean, currently the Navy's largest ship, is out on sea trials following maintenance at a cost of £30 million. The Royal Navy's activity in Plymouth continues to fire on all cylinders to meet the demands placed on it in theatres around the globe. HMS Illustrious—which I was fortunate enough, as part of the armed forces parliamentary scheme, to join for a "Thursday war" recently—has just completed her operational sea training and will soon be back on patrol. For the uninitiated—I suspect there are not many of those in the Chamber today—a Thursday war takes place each week in the sea off Plymouth and involves assessments being carried out on every aspect of a ship's company and their work under operational conditions by the expert team from flag officer sea training to ensure that the crew has reached a level of professionalism to allow them to perform in any type of scenario. If anyone has the opportunity of participating in one of these events, I recommend that they do so as they are eye-opening.
	Even in the light of all this activity, we are still facing a pattern of future work subject to dips and troughs. That is inevitable given the improved reliability of modern warships and submarines, and so when the future of the naval base was called into question, the city and the work force wanted answers to a range of questions. We wanted reassurance that the Ministry of Defence really understood the implications of any decision it took in terms of socio-economic outcomes and the synergy that exists between the naval base, the MOD's commercial partners and the city's residents. We also wanted to be sure that the MOD was working closely with other Government Departments to—quoting again from one of its web pages—
	"make a contribution in the regions".
	Had it closed Plymouth, its contribution to the regions would not have strengthened its position with other civil Departments; it would have made it a pariah, leaving others to pick up the tab for the trail of socio-economic devastation which would have followed. It would also have helped to destroy the skills base that Government and defence industries in the UK depend on.
	I am delighted to say that that scenario did not come about, largely because of the extensive lobbying by MPs, unions, the council and others. We made a very sound case to all the Government Departments concerned, and I must thank MOD Ministers for taking on board those wider representations. We, like other cities in the UK that are dependent on defence industries, are, however, still in limbo while the MOD negotiates with its industrial partners the terms of business agreements—TOBAs—which will set the parameters for their future work programmes. This is an unbelievably complex process where MOD and the industry are seeking to get a number of ducks in a row. However, as far as I can see from a position well outside the negotiations, the ducks keep moving.
	There is frustration in our city that there does not yet seem to be light at the end of the tunnel or any clear timelines on key decisions. I know, not least because of his work on the Defence Committee, that the new Under-Secretary of State for Defence, my hon. Friend the Member for North Durham (Mr. Jones) understands this problem well. Indeed, he himself has raised it, most recently in the Chamber on 19 June this year—at column 1171 of  Hansard—when, in a related context, he repeatedly asked the MOD what it was doing and emphasised the need for "clarity". I therefore hope we can expect both swift decisions and clarity from the new Minister.
	We have been told—and I have no reason to disbelieve it—that there is no intent on the part of the MOD or industry to keep Plymouth in the dark, but that does not help allay the natural concerns of those of us who are outside the process. I—and, I am sure, my colleagues—have great difficulty explaining to our constituents exactly what is happening, and although we are told that all will be well and that the dockyard's future is secure, we really want to see it in black and white or as in as sharp a contrast as possible. The work force and the smaller suppliers on whom the dockyard depends have concerns about what type of model will follow on from the TOBA announcements. Where will the surface work go? Will base-porting continue in its current form or change because of the ability of the fleet to keep vessels at sea for longer makes the whole strategy change? We would like to understand the Minister's thinking on this. Is his Department looking to change the model to meet modern strategic requirements? Surely he can indicate that without affecting the TOBA negotiations and the commercial sensitivities which surround them. If so, we would like to know so that we can understand how Plymouth fits into the wider UK picture in order to be able to consider how we can maintain the skills base we have developed to service the Navy's needs.
	The announcement on the carrier—the carrier vessel future—was of course very good news for Babcock and it will mean the shifting of some work from Scotland down to Plymouth in the medium term. That said, however, there are siren voices still unsure about the cost of this order and some who might even suggest the order could be reduced to one vessel or even cancelled. There is a lot of risk involved in reducing the order to one. All the conversations that I have had with Navy personnel suggest that they strongly support the announcement that these two impressive vessels will be added to the fleet, and that they understand that in the current global climate, we cannot rely on other countries to come forward and assist us in times of crisis. We definitely do need the safety of two such vessels, and we should not waver from our commitment to them.
	Babcock, which is currently working on the CVF programme, employs some 5,000 people and the MOD and Navy employ just under 1,000—people with higher-than-average earning potential. We need and will welcome a firm decision on a range of concerns, including base-porting, once the outcome of the TOBAs has been reached. The visible presence of the submarines and warships—the grey stuff—tied up alongside, and the military personnel and their families living in and enjoying Plymouth strongly feed into the city's identity; we do not want to lose this. Plymouthians, unlike the Opposition Front-Bench spokesperson, understand the importance of buying British and supporting British-based workers; it is not about supporting defence jobs in Plymouth for political reasons. His view is too narrow and is at odds with that of the Conservative council leader in Plymouth. Without those jobs, UK defence industries would lose expertise and the economic impact on the region could be devastating, with the Government having to pick up a much larger welfare bill. I am therefore hoping that my colleague can offer some reassurance, and that I can go back to my constituents with some good news from today's debate.

Nick Harvey: I want to start by echoing the words of tribute and condolence to those who have lost their lives or been seriously injured since we last debated defence matters in this House in July. In also paying tribute to the Ministers who have left their post, I should like to welcome the two who are with us today. I am glad that manpower shortages and overstretch in the rest of the military family is not going to extend as far as the Government Front Bench. It will be useful to us to have the two of them here; both have been active participants in defence debates. The hon. Member for Grantham and Stamford (Mr. Davies) produced a very worthwhile report on the relationships between the armed forces and the wider community. I hope that he will now have the chance to follow through some of the recommendations that he made in that report. The hon. Member for North Durham (Mr. Jones) is a very welcome addition to the Government Front Bench—one that is richly deserved and long overdue. As others have said, he brings with him a long list of past observations, which I hope he will be able to follow through.
	I do not know what the new Secretary of State can have thought when the phone call came inviting him to take up his post. Despite the admirable researches that have been reported to us, he has not recently been a participant in these debates. However, I should think by now—six days on—he must have a pretty clear idea of the immensity of the headaches that he has inherited and taken on. I put those as being principally a financial crisis in his Department, a lack of strategic framework—or at any rate, a confused one—for Britain's defence policy, and some decisions desperately needed on big procurement items.
	I do not know whether the MOD still bothers denying that it is in a state of financial crisis; if so, it is largely wasting its breath. It is a wide open secret that it faces a very serious financial problem. The budget for the three years of the comprehensive spending review will have to go an awful long way, and various estimates reckon that there is a funding black hole. Some say that it is about £2 billion; others say that it is as much as £5 billion. It is certainly going to be a very difficult 18 months for the ministerial team in trying to make sense out of that situation.
	Of course, we have the ongoing demands of two so-called medium-scale operations, in Iraq and Afghanistan, which have urgent operational requirements to meet the immediate needs there. There is also an enormous procurement shopping list looming, including carriers; the future rapid effect system; Astute submarines, the replacement, ultimately, of the Trident system; surface vessels; the joint strike fighter; another tranche of Eurofighters; and a new generation of helicopters. The list goes on and on.
	It is clear to all observers that the budgets, as formulated, are not adequate to meet all those requirements; one does not have to be a mathematician of any great strength to realise that things simply do not add up. There is a tension between the immediate needs of our armed forces in theatre and longer-term needs, which must be planned for now if we are to avoid further problems building up in a relatively small number of years' time.
	I applaud the work, reported to us by the Minister of State, in getting armoured vehicles out into theatre as quickly as possible. I am not clear exactly where the acquisition of a further 600 vehicles fits in the envisaged framework for the future rapid effect system, and I do not know whether anybody else is either. That matter is raised with me by industrialists and members of the armed forces, and it will be interesting to know how it is reckoned to fit strategically into what is planned.
	Equally, we read worrying newspaper reports that the joint strike fighter project is unravelling, and it is a mystery to me where that leaves our aircraft carriers, given that the joint strike fighters were what we were anticipating would fly from them. I do not know whether anyone views the idea of a marine version of Eurofighter as a serious plan B. Such a version would be costly and slow, and, judging by the answers given in previous sittings of the Defence Committee, I doubt that it is viewed as a realistic alternative.
	Some of these issues can be postponed a bit longer, but given that an election may still be 18 months away, the Government will struggle to maintain that it is business as usual and that all these thorny issues can be put off until after one. The alternative is the tried-and-tested formula to which the Ministry of Defence has resorted again and again over the years: salami-slicing. That is the worst of all worlds, because things end up taking far longer than was anticipated, costing far more, and there are far fewer of them and they have less capability than was originally planned. We must avoid continuing a Heath Robinson approach to defence: adding things on and adapting them in a haphazard manner.
	The new ministerial team will have to struggle with these thorny issues, and I believe that they will have to do so within some sort of renewed, or at least re-expressed, strategic framework. I have spoken before in this House of the crying need for a new strategic defence review. I accept that it would not be possible to conclude such a review this side of an election—it is debatable whether it would be wise to commence one this side of an election—but at the very least some of the initial groundwork for such a review should be taking place. If it were possible to secure any sort of all-party consensus on the questions that such a review needed to ask, they could be debated. If a consensus could not be arrived at, at the very least we should debate what questions the review needs to ask.
	I believe that those questions are: what kind of forces should we build and maintain in the next 20 or 30 years? Are we committed to maintaining premier league forces in all three forces on our own account? What do we want from defence? What part will be played by our allies in NATO, including its European countries, and by the rest of the UN? How will we work together to achieve the aims and objectives that I hope such a strategic defence review would identify?

James Gray: The hon. Gentleman will be relieved to hear that my hon. Friend the shadow Defence Secretary is committed to an incoming Conservative Government's conducting just such a strategic defence review.

Nick Harvey: All parties in this House are probably committed to such a review occurring. I know that a defence of this line has occasionally been peddled by Conservative Back Benchers, but it is clear that there will have to be a strategic defence review. Whatever the colour of the Government formed after the general election, it would be immensely helpful if some of the spadework had been done now to ensure that such a review could crack on quickly straight after an election and not have to go through a period of hiatus before it could begin.
	The new Secretary of State was a supporter of the defence industrial strategy in his previous job at the Department for Business, Enterprise and Regulatory Reform, and now more than ever in the light of the complexity of our operations abroad, we have to work with industry and ensure that we have a defence industrial base on which we can rely in times of conflict. We therefore need to breathe new life into the defence industrial strategy and we will have to achieve that within the strategic framework. I welcome the appointment of a director of strategy at the MOD, but it puzzles me that that has come seven years into our operations in Afghanistan and five years into our operations in Iraq. For all that the appointment is overdue, it is welcome, and I hope that it will provide a lead for the preparatory work that I have described.
	I am very anxious about the issue of helicopters, which is frequently raised in the House. I was alarmed to see some projected figures that were elicited by the hon. Member for North Essex (Mr. Jenkin) for the helicopter fleet that the MOD anticipates sustaining every year from now until 2020. If one looks forward five years to 2013, it is expected that 50 per cent. of our already reduced and undersized helicopter fleet will have gone out of service. By 2020, there will have been a 60 per cent. reduction in the number of helicopters, even if the future Lynx programme comes about as anticipated according to the time scale.
	We have to do everything we can to ensure that our troops are equipped with an adequate number of helicopters. Almost whatever the outcome of a strategic defence review, and the decisions that it might make about the size and shape of the Army, Air Force and Navy that we will need in the future, we can predict with certainty that we will need helicopters. They are fundamental to our success, not only in current operations, but in the long-term future. The number of helicopters that we can get into theatre is critical, as is their operational effectiveness in hot and high conditions, such as those in Afghanistan. In that country, it is clear that, given the increasing threat from roadside improvised explosive devices, we have to think afresh about the safe movement of our forces as they do their work. I welcome all that has been said about the new protective vehicles, but the quickest and safest way to travel is by air. New helicopters have many capabilities that old ones did not, but however highly equipped they are, they do not come with the ability to be in two places at once. Foremost among all the procurement headaches with which the new ministerial team will have to grapple will be ensuring an adequate number of helicopters in the future.
	Battlefield helicopters provide the agility and comparative security that we must have. We need a mix, a balanced force of helicopters, some for large lift operations and some that are small and agile, and can move effectively around operating areas. In summary, we simply need more helicopters.

James Arbuthnot: I entirely agree with the hon. Gentleman's concerns about the number of helicopters that our armed forces will have in the future, but I am concerned by his remarks about moving everybody around by air. As General Petraeus said last week, in order to persuade the hearts and minds of people in Afghanistan and Iraq, we need a presence permanently on the ground, with soldiers from different forces living among the populations they are trying to help to move towards their own governance.

Nick Harvey: The right hon. Gentleman makes a good point. I am not suggesting abandoning completely movements on the ground or the broader role on the ground that he describes. I welcome the new vehicles that are going out and anticipate that there will probably need to be more in the future, but as part of the overall mix we need more helicopters. We need the best equipped and protected helicopters. We need to ensure that they are of the highest possible standard. We need to meet new crashworthiness requirements and we need a balanced mix. Above all, we need those helicopters quickly. Looking forward to 2013 and 2020, decisions will need to be made very soon if we are not to have a situation in the future that is even worse than the situation now.
	The hon. Member for New Forest, East (Dr. Lewis) made some points about communications. He was right to touch on some of the difficulties arising from some of the statements that have been reported about the situation in Afghanistan. Attention is increasingly turning to Afghanistan as our role diminishes in Iraq.
	As the hon. Gentleman said, in the past week or two we have heard two interesting contributions from very well-placed people, one of whom was the most senior British commander in Afghanistan in recent months, who made the comments as he finished his time there. I agree entirely with the hon. Gentleman that the British commander was not really saying anything very new, anything very different or anything particularly shocking. However, the way that his comments have been written up in the media is bound to confuse members of the public, who, regrettably, have not bought into what we are doing in Afghanistan as I would have liked them to do. That will not have been assisted in any way by those reports.
	Similarly, the British ambassador in Kabul seems to have made some very interesting observations. Whether he had anticipated their being quite so widely circulated, I am not sure, but he has made some interesting observations about the difference between our approach and that of the Americans. In particular, I am thinking of the American actions within Pakistan's border regions, which are clearly causing a great deal of trouble in Pakistan and, probably, a fair few headaches in Afghanistan, too.
	Again, the Government have a real challenge on their hands. They must come out and explain afresh what we are doing in Afghanistan and clarify some of the confusions that will have grown up in the public mind. I say that in the knowledge that marines from the west country, including 1,000 or so from Chivenor in my constituency, have gone out to Afghanistan, taking over from the Paras. I worry about what their families understand to be the purpose, the challenge and the state of what we are doing in Afghanistan in the light of the reports that they must be reading in their newspapers. We wish them well, but I believe that the Government need to restate the case for what we are doing out there. I fear that we need to hear what exactly the British view of the new American strategy is. We need to join up defence and reconstruction, as has been said, to ensure that we can create a long-term picture of a viable state able to survive on its own.
	The biggest problem for the new ministerial team remains that of overstretch. We could begin to address that if we were to get out of Iraq entirely. The sooner we do that, the sooner the team will be able to make any meaningful headway in tackling overstretch.
	Finally, I pay tribute to all those in the armed forces at home and abroad, to those who have come back from their tour of duty and to those who are preparing to go, and to all who train, support and equip them. It is vital that they understand that in this House everybody very much appreciates what they are doing. There is a duty on us all to try to explain to the public what the troops are doing and to ensure that they succeed in these very necessary tasks, which they are carrying out in our national interests.

Doug Henderson: I start by welcoming the new Front-Bench team. I have known the Under-Secretary of State for Defence, my hon. Friend the Member for Grantham and Stamford (Mr. Davies), for a long time in the House. He has great knowledge of foreign affairs and defence, which will stand him in great stead as he faces up to the difficult task before him. I am sure that hon. Members will give him our full support.
	I have probably known the Under-Secretary of State for Defence, my hon. Friend the Member for North Durham (Mr. Jones), for longer than any Member of this House—with the exception of the Chief Whip. We know what he is really like. His first deployment in my constituency involved homeland security in Newcastle upon Tyne, North, where he had to secure a bridgehead against an internal enemy at the time. He secured the bridgehead very effectively with great steadfastness under enemy fire, which will stand him in great stead in carrying out his tasks in his new post. We all welcome him to the Front Bench.
	The subject of today's debate is defence in the UK. The global world in which we now live is not new in terms of defence, because international inter-linkages have existed for hundreds of years. To consider defence in one's own country, one must consider the impact of foreign policy and defence policy on a much wider scale throughout the world, and we must assess how well equipped we are to defend our own nation in that context.
	I was involved in drawing up the final stages of the strategic defence review in 1998. When I refreshed my memory of what we put to the House and the country at the time, I found that paragraph 2 included a telling sentence:
	"The Review is radical, reflecting a changing world, in which the confrontation of the Cold War has been replaced by a complex mixture of uncertainty and instability."
	We crowed a little bit in saying that "the review is radical"—all Governments say that—but it was radical. When that report was drawn up, we assumed that America was strong economically and a leader in foreign policy, that Russia was a weakened nation which had not rebuilt itself after the break-up of the Soviet Union and that China was relatively isolationist and very much concerned with its own internal affairs and economic development. None of us could assess India, although we knew about its economic failures over a number of decades, which began to turn around at the end of the 20th century. We used those assumptions in considering the strategic defence review.
	I wonder how many of those assumptions are now valid. There has been the further development of the international terrorism of the early 21st century, but how many of those criteria still apply? Is Russia still weakened and passive in its approach to international affairs? Is China still looking internally? Is it still establishing economic power, or has it established significant economic power? Is India establishing itself as a main player in both economic terms and foreign policy terms? Is America as economically strong and influential in foreign affairs as it was then? If those assumptions do not hold, we need to look again at how our foreign policy affects the world, and how we draw up our defence strategy.

Crispin Blunt: I agree that the questions that the hon. Gentleman poses are extremely important. I would add that we do not yet know what the consequences will be of what is happening in the global financial markets, and what it will mean to the real economies of countries across the world. Those consequences will affect our consideration of the issue. My recollection is that the strategic defence review was seen by many outside commentators largely as an endorsement of the policy that was inherited. Perhaps he might confirm that the strategic defence review took £500 million a year out of the defence budget—and that figure would have been £1 billion a year, had not the then Chief of the Defence Staff remonstrated with the Prime Minister.

Doug Henderson: I understand why the hon. Gentleman wants to get involved in party political points, but I have no intention of engaging in party political bickering on this issue. One could look at the Conservative Government's expenditure patterns up until 1997, but I do not want to go into that. There are much bigger issues facing the nation and the defence estate than minor differences of view among the political parties. It is the bigger issues that we have to address if we are to have a secure nation in future, and are to get our foreign and defence policy right.

Mark Pritchard: The hon. Gentleman mentions Russia; is he aware of comments made by President Medvedev in the past 48 hours suggesting that Russia should be part of some new security pact with Europe? Does he share my concern that that would destabilise the Euro-Atlantic alliance and the NATO alliance, which, albeit imperfectly, has ensured peace in Europe and further afield for many years? Does he agree that we should continue to support NATO and try to reform it from within, and that there can be no moral equivalence between the Administrations in Washington DC and in Moscow as long as Moscow continues to stamp out democracy, freedom of speech and religion, and the independence of the judiciary?

Doug Henderson: I do not quite take the same view as the hon. Gentleman. I do not know how much of my speech I will get through in my 15 minutes, but the view that the American Government took in the middle east was, "We can establish western democracy, over a period, in the middle east, and then these guys will know how to play the game; they'll be on our side and everything will be stable." America argued that that should be the case in Russia, but what it predicted did not take place. If that argument were successful, the logic would be that the Russians should be part of the NATO pact. That is the ultimate logic of that foreign policy doctrine. We—and the hon. Gentleman—need to be clear in our mind whether we agree with that doctrine. He needs to be clear whether he accepts my view that there is a logical conclusion to the argument. If he does not accept that, and he thinks that Russia will always be on the other side, and therefore not linked up with our interests, other aspects of defence policy will need to be considered. I want to come back to that point later in my speech, assuming that I have enough time.
	I shall have to speed up a bit to try to make my points. The question is whether one believes that the world has changed. I think that there is a need for another review of defence policy; the main thrust of that work should be done after the next general election, but in the interim, all of us have to do a bit of thinking on the subject. I completely agree with the view expressed by the Liberal Democrat spokesman, the hon. Member for North Devon (Nick Harvey), on that point. I am sure that many other colleagues, on both sides of the Chamber, see the need for such a review.
	Let me set out some of the issues that arise from the changing international picture. Have we got the emphasis right when it comes to counter-terrorism? Should counter-terrorism be the main thrust of British defence and foreign policy? It is clearly a very important issue, and we must counter terrorism wherever we can, in whatever way is most effective, both militarily and in the civil sphere; civil action is needed too, as I think is widely recognised. However, is that the main issue? In 10 or 20 years, will that be the main priority for the nation? That question has to be examined, whatever our view. My view is that the world has changed, that new power groups are emerging and that an assessment of the impact of those groups must be a key part of British foreign and defence policy.
	The second question that I want to address relates back to the point made by the hon. Member for The Wrekin (Mark Pritchard) about NATO policy in relation to Russia. The Cheney doctrine, which was adopted in the middle east, could never be successful—in a sense, it was the absence of a doctrine after the end of the cold war. The doctrine during the cold war was that we had to have sufficient political and military power to make sure that potential enemies did not do anything stupid and that they recognised that. There had to be a balance of power to achieve that. That doctrine achieved relative stability for 30 or 40 years after the end of the second world war.
	After the fall of communism and the end of the cold war, what was the doctrine? What was NATO's purpose? A lot of us were asking that question, but we never successfully addressed it. That is why when there was a proliferation of terrorist attacks in different parts of the world over a period of 10 years, culminating in the attacks in New York and followed through by the attacks in Spain, Britain and elsewhere, we said that we must focus on countering those atrocities, but forgot about the doctrine of foreign policy and defence policy beyond that. We must return to those now, as we again see the emergence of major power blocks. That is a key issue.
	We cannot persuade Russia, the middle east, the Indian subcontinent, China or other Asian countries to be like western Europe or north America. What can we persuade them to do? We can persuade them to co-exist, and it is in everybody's interest that that stability is re-established. That should be the central part of our foreign policy; it follows that defence policy must reinforce that. I may be wrong on the issue. Some say that my view is over-pessimistic. However, I do not believe that in 10, 20, 30, 40 or 50 years' time, China, Russia and the Indian subcontinent will look anything like what Marxists used to call "bourgeois democracy" in western Europe and north America. The danger is that those countries will end up in the hands of aggressive dictators; it is also possible that they will divide into different groupings. Our policies must be capable of dealing with that issue.
	Are our current alliances appropriate to deal with those threats? Any review needs to consider these different issues. I am absolutely clear that NATO needs to move forward and change to adapt to new circumstances, but it has to be the cornerstone of British, European and north American defence. However, I also think that the European Union will play an ever-increasing role. I know that there are differences of view in the House about this, but I am thinking from a military point of view.
	As a member of the Defence Committee of the European Security and Defence Assembly, also known as the Western European Union, I frequently meet military commanders. It is amazing—even military commanders who are broadly hostile to the European Union want more linkage with their colleagues and the organisations in Europe with which they associate. The EU needs a better defined defence policy and to work more closely with NATO. NATO and the EU need to know how they can get the best out of their strengths and eliminate their weaknesses. That has to be the core of the structure of future political organisation to counter the other power groups emerging in the world. NATO member countries must, under article 5, come to the assistance of another member country that is under threat, but the European Union does not have that provision—at least constitutionally, although it does have it implicitly in many other ways. That is inconsistent, and the extent to which the EU provides such cover needs to be clarified over the period ahead. If we all have the same values, we should have the same protection.
	Then we need to consider the more practical questions as to whether we are properly equipped to face this situation. Intelligence—the foundation of successful military operations—is one of the key areas where there will be a need for a wide debate. There has recently been a move away from our intelligence services being focused on knowing what opponents—or enemies in the cold war era—are up to towards what terrorist organisations are up to. The ultimate conclusion must be that we need more resources and expenditure to defend the nation, and we might well end up in that position in the years ahead. The key issue is the need to decide on the allocation and direction of our intelligence forces.
	We need to re-examine our sea power, which was mentioned by my hon. Friend the Member for Plymouth, Sutton (Linda Gilroy), as well as our air power. We need to think about our lift. Is it realistic for each country within Europe to have its own lift? Are we to be dependent on private sector contractors from Ukraine in that respect, and if so for how long? What are the implications of any changes in the relationship between Russia and the UK? What about our ground troops capability? We have already heard about the dilemma between air cover from helicopters and forward movements on the ground where local populations are closer.
	Then there is the role of nuclear weapons. I support the modernisation of Britain's nuclear deterrent, which must be considered in this context as well.
	Let me conclude with two points. First, I am a rapporteur at the ESDA on the question of how European operations should be headquartered, where there is a need for less duplication. Secondly, we need to examine the whole issue of aircraft carriers, including cover in the air and frigate defence. Can France and Britain continue to try to provide everything? Can some of the other countries in Europe help to contribute to the European capability? How does that link into the United States, where it is a NATO operation?
	The new Front Benchers will be very busy dealing with day-to-day matters, but I hope that they will have a little time to reflect on some of the issues that I have mentioned. I agree that after the next general election there will inevitably be a defence review. Given the consensus in the House on that, progress should be made.

James Arbuthnot: These debates always produce well-informed and interesting speeches from well-informed and interesting people, but the speech by the hon. Member for Newcastle upon Tyne, North (Mr. Henderson) was one of the best speeches in a defence debate that I have ever heard in this House, and we should be grateful to him for what he said.
	I should like to echo the expressions of sympathy to the families of people who have died in Afghanistan. It is always an individual tragedy when any one soldier dies. There is, however, a degree of comfort in something that right hon. and hon. Members will have noticed—that it was in only one theatre of war that we had those casualties over the summer. That suggests that those who had previously died in Iraq on our behalf had achieved a real measure of success. Let us hope that those who have recently died in Afghanistan will eventually achieve, through their sacrifice, the same degree of success as those who have previously died in Iraq. We are very grateful to them and to their families.
	I would like to echo the congratulations to the new members of the Ministry of Defence Front-Bench team. As I have said, what the Under-Secretary of State for Defence, the hon. Member for Grantham and Stamford (Mr. Davies), said about the armed forces in his recent report achieved a real effect in the transformation of the way in which the armed forces are regarded in this country. I hope that we can achieve more, but I pay tribute to him, and he will no doubt have a great deal of work to do following on from the noble Baroness Taylor in the equipment and support role.
	It is a real pleasure, though, to see the Under-Secretary of State for Defence, the hon. Member for North Durham (Mr. Jones), removed from the Select Committee on Defence. That may not sound entirely right, but he brings to the Ministry of Defence a feisty—some might say verging on the belligerent—approach that is necessary. He has long experience of the Defence Committee, where he built up a huge degree of knowledge and asked some valuable questions. We will miss him; he performed a very valuable role.
	The Defence Committee has carried out several inquiries recently. It recently produced a recruitment and retention report, and one of the things it concentrated on was the difficulty the armed forces have with manning balance. It was a worry to us that the Army will not find itself in manning balance until 2011, and that the armed forces have now identified 73 pinch-point trades where there is a shortage of personnel. We welcome the Command Paper produced by the Government, which the Minister of State mentioned at the opening of the debate. Who it was that produced some of these brilliant ideas, the Government or the Opposition, we do not need to fuss too much about. We should, as my hon. Friend the Member for New Forest, East (Dr. Lewis) said, welcome such ideas from wherever they come.
	Another report we recently produced was on medical care for the armed forces. I want to echo something said about the excellence of care provided at Birmingham Selly Oak. There have been a lot of newspaper stories about shortcomings at Birmingham Selly Oak, which we found were not borne out by our inquiries. The people who provide care there are to be congratulated and commended for the work that they do, unstintingly, for our armed forces. In September, I went to Israel in my role as chairman of the Conservative Friends of Israel, and I visited the Hadassah hospital in Jerusalem. In Birmingham Selly Oak, we had found that the excellence of trauma care in our country was to be commended. However, I found that such care was even better in the Hadassah hospital, and by a considerable margin. I have just written a letter to the Under-Secretary of State for Defence, the hon. Member for North Durham, to ask whether we can learn any lessons from the way in which other countries deal with trauma care, and I hope that some interesting ideas will come out of that.
	We are just about to begin the public evidence sessions of an inquiry into national security and resilience. Last week, we had a valuable visit to the counter-terrorism science and technology centre at Porton Down. We were very impressed by the wide range of work that is done there, from all sorts of disciplines, to counter terrorism. As we left, we felt that some improvements in communication between Departments could mean more joined-up government, so that more Departments could take advantage of the excellence of the work that is done in Porton Down. However, overall, we felt that it did a good job.
	Parliament needs to consider a further matter—the parliamentary scrutiny of national security and resilience. As my hon. Friend the Member for New Forest, East said, it is a cross-cutting issue, and it needs proper parliamentary scrutiny. I hope that the Government will move ahead more quickly in getting some sort of Select Committee scrutiny of the matter—I know that they have had that in mind for a long time.
	Let us consider military bases. The super-garrisons will come on stream from 1 April next year. There are benefits to super-garrisons, including much more stability in the populations that are based in them. For example, there will be much less turbulence in service children's education, about which we did a report last year. Such benefits will be real. However, super-garrisons mean that members of the armed forces will find it increasingly tempting to buy their own houses, especially if house prices drop sufficiently to be within their reach. The trouble is that that will reduce the cohesion of the patch. As parliamentarians, we must be aware of that when introducing some of the changes. However, overall, I believe that the super-garrisons will prove beneficial to the armed forces.

Julian Brazier: There is a point to add to my right hon. Friend's strong points. The last big study—in 1995, if I remember rightly—showed that, once a member of the Army had bought married quarters, he was 50 per cent. more likely to PVR in the subsequent few years. It is unfortunate that, although we need to encourage the aspiration of eventual home ownership, in the Army—the most mobile of the services—buying too early is a recipe for losing good people much more quickly.

James Arbuthnot: I agree with my hon. Friend, apart from his lapse into MOD-speak. I have no doubt that PVR means prematurely voluntarily retiring—

Crispin Blunt: Premature voluntary release.

James Arbuthnot: I shall move on to this country's defence industries.
	As the Minister of State said, we need a strong defence industry in this country and we should be proud of what it produces. The industry should be proud of that and proclaim the virtues of this country's defending itself with good, British-made defence industrial goods. It is this country's right to defend itself with proper equipment, as it is that of other countries. Since we produce some of the best equipment in the world, we should be proud of our defence exports and proclaim their virtue in the face of those who denigrate us for being arms salesmen. We give other countries the opportunity to do their duty—to defend themselves. To achieve that, we need a defence industrial base that is strong and knows what the Government are doing. Unfortunately, there is currently a sense of complete paralysis in the defence procurement world. As the hon. Member for North Devon (Nick Harvey) said, people do not know what happens in the defence procurement world. There is a sense that senior officials in the Ministry of Defence are just trying, because of budgetary difficulties, to survive.
	Somewhere, somehow, the Government need to take control and start making some decisions. We have been given a provisional decision about FRES; it needs to consolidate into a real decision, and soon. We have been given some sort of indications about the future Lynx, but when will we have a decision about it? The Chief of the General Staff needs both of those, and needs them quickly and in proper quantities.
	I have been reflecting on the question that I asked the Minister of State about what the chief of defence matériel said last week. On reflection, I think that I may have misreported our conversation. I would like to apologise to him and to withdraw what he said, because I do not think that it went quite like that and, anyway, it was in private and I should not have said what I did. So, I apologise to him and withdraw my remark.
	Having said that, I think that the defence industry in this country needs to know who is in charge of the defence industrial strategy. Of course, it is enormously reassuring to know that the Under-Secretary of State for Defence, the hon. Member for Grantham and Stamford, is in charge of these things. However, we need to know who is in charge underneath him—who is in charge in military terms and in civil service terms—because the defence industry will not, frankly, be negotiating with him. It will need to know that somebody is driving things forward, but at the moment it has no sense that anybody is.
	I want to make one final point, about the planning assumptions. As we know—as the Ministry of Defence tells us—the MOD has been operating at or above the levels for which it is resourced and structured for seven out of the past eight years. We can get away with that for two or three years, perhaps; we certainly cannot get away with it for seven or eight years.
	All that is based on planning assumptions that have been routinely wrong. So, what the Defence Committee did in April this year was to write a letter to the then Secretary of State for Defence to ask when we would have the results of his review of the planning assumptions, which he announced last year. It would be right to read what the Secretary of State said:
	"Of course the Defence Planning Assumptions are a core part of our planning process. As you know, we conduct a review of these assumptions on a regular basis".
	The trouble is that over the past six years or so that review has always proved to be wrong. He continued:
	"Our latest thinking is that the next iteration DPAs will not present a radical departure from those issued in the last Defence White Paper."
	That is a real worry. In view of the comments in the previous speech, which I have just said was one of the best speeches we have heard in defence debates in this House, the issue is one that we have got to revisit. The planning assumptions are wrong. We cannot rely on them. We should not be sending the armed forces of this country into battle on the basis of assumptions that we know are wrong.

David Wright: It is a great pleasure to follow the Chairman of the Defence Committee. I join others in welcoming the two new Ministers to the Front Bench, more of whom later in my contribution—all good, I can assure them.
	I want first briefly to cover three issues, then I want to talk about the opportunities for Shropshire, and Telford in particular, to emerge as a key defence hub in the UK. I note that the hon. Member for The Wrekin (Mark Pritchard) is in his place. He will probably agree with pretty much everything that I have to say, but we shall see as we proceed. However, I know that we both want to see Telford and Shropshire flourishing as they make their contribution to UK defence.
	I want to begin, however, by echoing the tributes that other Members have paid to our armed forces in these difficult times. The people of our armed forces are simply remarkable, and they deserve our thanks. Shropshire people have a particular connection with 1st Battalion, the Royal Irish Regiment, which has barracks at Tern Hill. The regiment has done difficult work in all the major conflict zones around the world in recent years, and the county is paying tribute to its members as they return home at the moment. In fact, they arrived home yesterday. I understand that there is to be a march past in Shrewsbury next Thursday. Unfortunately, I shall not be able to be there, so I want to use this opportunity in the House to pay tribute to them for the work that they have been doing in Afghanistan. I am sure that the whole House will want to join me in doing that. Many people from Telford are serving in conflict zones across the world, in the armed forces and in the support services, and I want to place on record my thanks to them as well.
	The first substantive point that I want to make is on the theme of renewing the connection between our forces and the communities that they serve. I know that the Under-Secretary, my hon. Friend the Member for Grantham and Stamford (Mr. Davies), has been doing some work on this matter. I particularly want to make the Under-Secretary of State, my hon. Friend the Member for North Durham (Mr. Jones), smile. I did the armed forces scheme with him; we did a stint with the Royal Marines. He says that I say what I am about to say in every defence debate; I do not want to disappoint him. He knows what is coming.
	I really believe that people used to feel connected with the armed forces when regiments or warships bore the names of specific towns or counties. We are now losing that linkage, and we ought to look into reinstating some of those connections. It would be great, for example, if we had an HMS Shropshire or an HMS Telford. The last HMS Shropshire was launched in 1928. She served in the south Atlantic, and was passed over to the Australian Navy in 1942. She was in Tokyo bay when the Japanese surrendered. We should have another HMS Shropshire, an HMS Telford and, perhaps, an HMS Wrekin. We need to renew those connections between our forces and our communities.
	I should also like to call on Telford and Wrekin council to review what it is doing about offering freedom of the borough status to regiments that are present in the county. This applies not only to the regular forces but to the Territorials who are based in our towns and communities. I hope that the council will look positively at that proposal in the coming weeks.
	My second point is to say how much positive feedback I have had about the veterans' badges, which have not been mentioned yet today, and about the badges that recognise the contributions made by the Land Army and the Timber Corps. In Telford, the Royal British Legion and I have been promoting those badges hard, and we have held a number of presentation events at the Dawley Royal British Legion club. Albert Colley and the team there have been working with me to encourage take-up of the badges. I would also particularly like to thank Richard Overton, who works in my office, for his work in helping people with their applications. His reputation is spreading across the country; he gets calls from right across the UK because people know that my office is promoting the veterans' badges and the badges that recognise the contributions made by the Land Army and the Timber Corps.
	The British Legion has some excellent active branches in Telford, and it is always a pleasure to work with them. I have been having a dialogue with them for some time about the military covenant, and I welcome the comments that I have heard today from the director-general about the covenant being brought back into balance.
	While I am on the theme of recognition for service, I want to take up my third point, and to press the minister on the campaign, which he will know well, for an award for those who have been injured or killed on active service. I have always thought that the medal system in this country was very good, because it does not make it easy to win an award. However, I think that we need to look at the system and at how we recognise people who have been injured or killed on active service. This is not about whether people do or do not support the principles behind a particular military operation and it is nothing to do with the politics of conflict. It is about recognising sacrifice. It would be helpful if the Minister said whether, in his new role, he will pursue the issue of whether a medal can be awarded to service personnel who are injured, or indeed whether an award can be made to their families if they are killed in action.
	I want to move on to develop the main theme of my speech, which relates to the opportunity to create a strong and long-term defence hub in the town of Telford. We have a long tradition in the town of supporting our forces, largely focused on civilian staff working for the Ministry of Defence. In recent years, I have worked with the trade unions to protect jobs and we have had some notable successes. We campaigned to keep the Army Base Repair Organisation located at Donnington, in the Wrekin constituency, and the MOD recognised that the specialist staff there provide a flexible, responsive and cost-effective service in repairing and modifying armoured vehicles, and in developing new solutions for the protection of our front-line troops.
	Alongside that, I campaigned with the unions to keep defence equipment support staff based at Sapphire house in my constituency. The Government—wisely, in my view—changed their mind and decided not to move those posts down to the Bath and Bristol area. They ultimately moved to merge the operation with ABRO to create the new Defence Support Group. I acknowledge that there have been some job losses in that process—about 100 will be gone by March next year—but thankfully most of the losses have been handled through voluntary redundancy, which is better than losing the jobs altogether and their moving out of the town. With the merger of those two significant organisations, there is a genuine opportunity for us to develop an exciting defence support initiative in Shropshire.
	I understand that a capacity and capability review is under way in the new organisation. Here are a few suggestions for consideration as part of it. First, we should build on the recognised local skills base and develop Telford as a defence hub for the UK. Secondly, we should develop in-house skills and—I stress this point—partner with industry. We should not outsource as a matter of course through the industrial strategy. The existing teams work hard and provide the flexibility that we need to respond to the operational environment that we are encountering at the moment. There is an increased tempo as we have to repair armoured vehicles, get them back out on the road and on active service. That is important and we need to ensure that we preserve the skills that we have at ABRO.
	Thirdly, we must ensure that arrangements with BAE Systems and others are structured to deliver that partnership. I stress the word "partnership". Let us ensure that we procure the product that we need and that we are not led down routes specified by external organisations. At the start of the process, let us dictate very clearly what we want.
	Fourthly, we need to evaluate the added value that existing staff bring to the table and ensure that we retain that good will. Sometimes, I do not think that we evaluate carefully enough contributions that people make that are not necessarily clearly defined on a cost-benefit sheet. Sometimes, monetary value cannot be put on service and loyalty provided by civilian MOD staff. I do not want us to lose those things, and we have them now in Telford.
	Alongside the Defence Support Group, we have the Defence Storage and Distribution Agency—jobs that were won in a competitive environment some two and a half years ago. Cost savings have been made and the operation runs extremely effectively. I think that Ministers can see that we have a real opportunity in Telford to ensure that we have an effective defence hub looking at procurement, repair, supply and provision. It is an exciting opportunity that we should not waste.
	At the beginning of the debate, the hon. Member for The Wrekin rightly pressed the Minister on the defence training review. I want to conclude on this point, and I am sure that the hon. Gentleman will agree with me. Many of us in the west midlands did not agree with the decision to move defence training down to St. Athan. We want some clarity now on the delivery of the scheme. When the announcement was made, there was a commitment to some continuing training facilities within Shropshire. We want to know that that remains so. We also heard about the relocation of 1 Signal Brigade and 102 Logistics Brigade under the Barona programme. We understand that those units will be relocated to Cosford.
	The programme has been delayed around St. Athan, and we need some clarity. We do not want to be in the worst of all worlds, whereby a Government decision about Cosford is delayed, and we find out that the Barona programme does not fit with the time frame for establishing St. Athan. In that scenario, we lose defence jobs from Cosford to St. Athan, and we take so long to make the decision that units are not transferred back to the Cosford site.
	We must make sure that such decisions are taken quickly and effectively. I would welcome a further update from Ministers on behalf of my constituents who work at Cosford about what is happening at St. Athan. That statement might not be today, but in the coming weeks. However, it is important to nail down the programme effectively, so that Shropshire emerges as a place where we have a long-term commitment to the UK's defence.

Julian Brazier: I, too, congratulate the three new Ministers in the Ministry of Defence. I shall be brief, as I am conscious of the number of Members who wish to speak.
	I join all those who have said that in this dark time for the country and the world we should remember how much harder a time our armed forces and their families face than the rest of us. As the Member for Canterbury, I am conscious of the price that the 5th Battalion, the Royal Regiment of Scotland, has already paid in casualties, along with the 3rd Battalion, the Princess of Wales's Royal Regiment, our local Territorial Army battalion, which also has troops serving in Afghanistan. Lieutenant-Colonel David Richmond, the gallant commanding officer of the 5th Battalion—or the Argylls, as we still like to think of them—is currently recovering at Headley Court from serious wounds. I was saddened too by the deaths of three members of the sister regiment of my old unit, 23 Regiment Special Air Service.
	The figures given by the Minister in the interchanges between Front Benchers on improvements in recruitment and retention reflect some commendable changes in terms and conditions of service, but also the economic downturn. It is worrying that in certain key areas, especially the fighting elements of the Army and air crew, we are still extremely short of people. In that context, it is important to remember that the bare numbers conceal a large number of people who are temporarily physically downgraded because they are recovering from wounds or injuries—in some cases mental as well as physical injuries. It is also a blunt truth that the physical requirements for joining the Army have gradually lowered over the past generation; the present combat fitness test, for example, is of a much lower standard than a generation ago.
	I do not intend to get into the banter as to who is bidding higher on improving conditions of service, but I am glad that there have been some improvements. Let me isolate one small item that would not cost any money, and which was raised with me by the wife of an officer in the Argylls—the issue of allocation of school places. Currently, schools are allowed to ask for the address of a family who want to place a child in a school. An army family being posted into an area can put down the date that they will arrive, but under the normal system of quartering do not normally know exactly what their address will be. So we have seen the absurdity of a soldier's wife having to stay in a hostel for months before her husband's posting so that she could get her child into a heavily oversubscribed local primary school. That problem could be fixed at the stroke of a pen, and should cost nothing at all.
	I want, however, to go beyond the question of terms and conditions and touch on the issue of cultural isolation, about which the hon. Member for Telford (David Wright) had a certain amount to say, and the gradual erosion of the links between the service community and the wider community. I pay tribute to the study conducted by the Under-Secretary of State for Defence, the hon. Member for Grantham and Stamford (Mr. Davies), and his team earlier in the year, although I think he would be the first to admit that recommendations of the kind that he produced can make only a modest difference to a situation that has been gradually deteriorating ever since the ending of national service.
	I certainly agree with my right hon. Friend the Member for North-East Hampshire (Mr. Arbuthnot), the Chairman of the Select Committee, that 79 per cent. is not a good enough approval rating, but it is not just a case of whether the civilian community approves of the armed forces who are taking the risks in Afghanistan and Iraq; it is a much wider issue. People with very little exposure to the armed forces are much less likely to encourage a son or daughter to join, and, to put it bluntly, less likely to support necessary defence spending.
	The position has been worsened by the concentration of our armed forces, which is happening at a much faster rate than the rate at which they are becoming smaller numerically. The Royal Navy, apart from the submarine force, is now concentrated almost entirely on the western end of the south coast, and the Royal Air Force has lost all regular contact with large parts of the country, including the whole of north-west England. My right hon. Friend the Member for North-East Hampshire mentioned the move towards super-garrisons. Another of its effects is that, while we may talk of homecoming parades and the like, there will be progressively fewer small market cities and towns like Canterbury with a single regular and a single Territorial Army unit where such events can happen. Visiting my sister near Catterick, I was reminded that it already has a super-garrison with virtually no civilian community.
	That brings me naturally to the subject of our reserve forces, which form a much smaller part of the picture than the reserve forces in America, Australia and Canada—three countries which, like ourselves, do not have a conscription model, which face the same challenges, and which are engaged in the same theatres in much the same way. Part of the reason why I believe that the connection is so much better in all those countries is that, in ball-park terms, volunteer reserves in the other three countries constitute roughly half their land forces; in Britain, the proportion is only about a quarter. In America, more than a third of air squadrons are volunteer reservists, while the proportion of individual pilots is much higher. In Britain we have fewer than 30 pilots in the volunteer reserves, and only 800 trained Royal Auxiliary Air Force reservists. As for the naval side, in America an aircraft carrier has been set aside for the exclusive training of reservists, while in Britain we do not even have a mine warfare vessel for the purpose.
	That is why I welcome the MOD's review of reserves. I must pay tribute to the work of General Nick Cottam and his team: I think that the MOD has chosen an extremely good project manager. I am also extremely grateful to the Minister of State, who I know has had to leave us early for a good reason, for the way in which he has fostered a relationship between that team and our all-party group. I am pleased to see present the hon. Member for Plymouth, Sutton (Linda Gilroy), who is an active member of it, as well as serving on the Select Committee.
	The Minister of State rightly drew attention to the huge role—quite disproportionate to their size—that the reserve forces have played in Afghanistan and Iraq, but I urge the House to bear in mind that, vital as that role is, it is not the first purpose of reserve forces. Their first purpose, when money is tight and the regular forces are overstretched in the here and now, is to provide a capability for the unexpected. Let us consider some recent events in which we have been involved. No one expected the Falklands war a week before it began, and no one expected that we would send armoured brigades to the desert of Saudi Arabia six months before we did so. We had no warning at all of 9/11, of course, but we would not now be in Afghanistan—or, arguably, Iraq—if it had not happened.
	Reserves are a cheap way of keeping capabilities in place that might unexpectedly be needed. They are much cheaper than regular forces, but unfortunately, the one drawback is that they take much longer to build up than regular forces. It is possible to train an officer for the Regular Army in a year, but for the Territorial Army that typically takes three or four years. We cannot create them when we need them; if they are not in being, we have not got them. Unsurprisingly, therefore, the central theme of the two reports that our all-party group prepared has been the necessity of structuring reserve forces in a way that attracts good-quality men and women to act as officers and non-commissioned officers in them, so that we really have something usable there.
	One of the most common remarks in debates before Afghanistan became a high-intensity war was that the Army could be structured so as to work in high-intensity operations and then go out and do an excellent job of peacekeeping, but if we ever designed an Army based around peacekeeping, it would ultimately fail in all its roles. A similar point needs to be made about volunteer reserves. If we design volunteer reserves to operate as formed units to provide a framework in which people have interesting and challenging work to do, with opportunities to take at least sub-units from time to time abroad on operations, we will produce an organisation that is also extremely good at producing quality augmentees for regular units, but if we allow some at least of the senior regular hierarchy to persuade us that we should just structure volunteer reserves to produce augmentees— spare lance-corporals and privates—to top up regular units, we will produce an organisation that not only cannot do the strategic job if the balloon truly goes up, but also in the long run, because it will have lost all its best officers and senior NCOs, is not training any quality augmentees either.
	That brings me to a short list of a few of the things we pointed out in our reports. If the infantry and the Special Air Service and units such as 131 Commando Squadron Royal Engineers can provide formed sub-units that operate successfully, other parts of the TA should also be able to do so. However, in order for any part of the volunteer reserves to operate, they must have opportunities for interesting unit level exercises, but there are very few of those at present.
	We must make more use of officer training corps and other university units for officer training. They are excellent organisations, but they are underutilised in a string of ways. Let me give one example: why cannot we have special-to-arm courses tacked on to the back of the Sandhurst courses in the summer so that a student who wants to can do what happens in America or Australia and undertake their whole officer training in one go?
	I wish to mention two last points. One is a point made earlier about aviation. It is unforgivable that a country that has such a big, successful and dynamic aviation industry simply writes off the whole investment it makes in people who leave the RAF having trained as pilots. If the Americans can have reservists operating a whole range of aircraft, it is ridiculous that we cannot make more use of reservists on operations, at least for helicopters. The other point is about mine warfare. Mine warfare is either not needed at all—we do not use it in Afghanistan for obvious reasons, although we have naval pilots and Royal Marines heavily engaged there—or it is needed, in which case a hell of a lot of it is needed. The current arrangement whereby we have one expensive regular crew for each mine warfare vessel is ridiculous. It is both expensive and, by definition, has no surge capability; a mine warfare crew cannot be worked around the clock as their work is very exhausting. If we handed a couple of those over to the volunteer reserves and trained a large number of volunteer crews on them, for the same money we would be able to deliver a much greater capability.
	At a time when our armed forces are increasingly isolated as well as overstretched, I am pleased that the Government are reviewing their reserve forces. I look forward to that review, and I urge the House as a whole and the Government to realise that volunteer reserves could play a much larger role in the defence of this country.

Linda Gilroy: It is a pleasure to follow the hon. Member for Canterbury (Mr. Brazier), and I pay tribute to him for his leadership of the all-party group on the reserve forces, which I may say a little more about in a moment. The hon. Member for North Devon (Nick Harvey) mentioned the deployment from in and around his constituency to Helmand, Afghanistan. From Plymouth and the surrounding area, too, there is a major deployment to Helmand, involving 29 Commando Regiment, 3 Commando Brigade and a lot of reserves, particularly medical reserves—people who in their normal lives work as medics at Plymouth's Derriford hospital and other hospitals in Devon and Cornwall.
	I am pleased that our lord mayor, Councillor Brian Vincent, is recognising the role of those people at the beginning of, throughout and at the end of that deployment. That is very much in accord with the recognition study undertaken by the Under-Secretary of State for Defence, my hon. Friend the Member for Grantham and Stamford (Mr. Davies), whom I welcome to his new position on the Front Bench. The lord mayor and his lady mayoress, Pauline, got up at 3 am to see the personnel off from the Royal Citadel, as they have done on a number of other occasions. Pauline has a son-in-law who is deploying, and events are planned for the many families who share the interests and concerns that go along with having military personnel in the family. The personnel will also be welcomed back with a parade, which should happen just before the end of the mayoral year.
	I look forward to working with the new defence team, and I am very glad that my right hon. Friend the Minister for the Armed Forces remains part of that team. I welcome its new members, particularly the Under-Secretary of State for Defence, my hon. Friend the Member for North Durham (Mr. Jones), part of whose period of service on the Defence Select Committee I shared. Reference was made earlier to his robust and trenchant contributions, which we will certainly miss. He made many special efforts, including a visit to our dockyard in Plymouth when he had been unable to join the original Defence Committee delegation. He also made particular efforts to ensure that the needs and interests of new recruits and the ranks were well represented in our deliberations in Committee. I trust that he will continue to take that approach in his very different role as Minister.
	I want also to pay tribute to the former Secretary of State, whom I always felt positively welcomed scrutiny. He had a listening ear and engaged with us fully—sometimes a little too fully for our liking—but he also took away ideas and put them into practice. When his period of office is examined, it will go down in history as one during which, with the assistance of my hon. Friend the Member for Grantham and Stamford and his recognition study, the various strands of personnel, families and service conditions that needed to be brought together were brought together, and were entrenched by making the external framework group permanent, so that it can ensure that such issues are not lost sight of.
	I also welcome the new Secretary of State for Defence, my right hon. Friend the Member for Barrow and Furness (Mr. Hutton). As the hon. Member for New Forest, East (Dr. Lewis) said, my right hon. Friend brings to the post a depth of experience and an industrial background, and he represents a constituency in which submarines and defence matter. I hope that he and his team will engage with the Defence Committee and with constituency Members of Parliament in the same measure as the previous team did.
	The Chairman of the Defence Committee, who spoke earlier, discussed a number of the inquiries that we have been doing and that we have in hand. The recruitment and retention report was comprehensive, and we await the Government response, which is to be published next week. The report dealt with the important role that families play as gatekeepers to recruitment, and with the reserves. I should add to the points made by the hon. Member for Canterbury only by saying that in a world in which people's lives have changed out of all recognition and people do not expect to have one job for life, the reserves have a much wider and bigger role to play, as he indicated is the case in other countries.
	The Committee has also been examining national security and resilience, following the Prime Minister's publication of "The National Security Strategy of the United Kingdom: Security in an interdependent world" in March. We are looking into the contribution that the Ministry of Defence makes to security and resilience, what it understands the nature and scale of the threat to be, how that threat affects the defence planning assumptions and what capabilities—maritime, land, air and personnel—we need to provide as a result.
	The Committee will continue to undertake number of inquiries into the MOD's performance and expenditure plans. A persistent theme of those has been the concerns about how the Government should resolve the tensions between supporting the high tempo of current operations, especially given the urgent operational requirements, and addressing how priority given to those has an impact on force structure and the forward equipment programme. Most commentators expect cost pressures to result in cuts and delays to the forward programme, and perhaps the cancellation of a major programme. The chief of defence matériel told the Committee that he suspected that that would be so, and the ongoing speculation on the matter is inevitable until we learn the outcome of the review that the MOD is undertaking in order better to prioritise its spending plans.
	My hon. Friend the Member for Plymouth, Devonport (Alison Seabeck) discussed the concerns about the size and make-up of the fleet. They tend to preoccupy those of us who live, work in and represent big naval communities in a way that does not take account of the equally strong rumour mill that deals with similar scenarios for land and air forces, particularly the Eurofighter—reference has been made to that. Admiral Sir Jonathon Band's warning that the fleet could lose its flexibility if the Government cut back too far on warships and manpower needs to be heeded.
	Huge cost savings could be found across the naval and other procurement programmes. Their implementation across the activity that forms the maritime change programme is extremely complex, involving the terms of business agreement for the joint ventures with BAE Systems and VT Group, as well as the Babcock purchase of my local dockyard, and the surface ship support programme and the submarine enterprise collaboration arrangement. They are all taking an extremely long time to dot the i's and cross the t's, and that is proving particularly difficult for those who want to see and understand the shape of the naval defence sector in Plymouth and Devonport.
	Since the end of the naval base review, which concluded that all three naval bases were required, I have met the Minister for the Armed Forces numerous times, often with trade union and council representatives, to discuss the long-term future of the dockyard and naval base. Each time, he has gone to great lengths to assure us of Devonport's future and to give as much information as he can. The last meeting was followed by a letter, in which he stated:
	"Our overarching strategy is to effectively smooth work across our three bases, to ensure that industry have a steady drumbeat of orders and that each base remains a viable hub for the future. This will inevitably involve optimisation at each location, in order to best deliver the most effective solution. This is not a threat, but an opportunity—in all of the scenarios that we are currently considering Plymouth is a net gainer in jobs."
	I hope that my hon. Friend the Minister will be able to confirm that we are still on track to deliver that commitment in Devonport. I thank the Minister of State for all his patience in understanding the many representations that we have made in recent months on that matter. We will continue to make them, as the issue is so important to us in Devonport. We have accepted his reassurances and waited patiently, but that has not been easy, not least because we have watched the Government invest in orders for carriers, destroyers and submarines with high-profile and immediate benefits for shipbuilding dockyards elsewhere in the country, but not—at least as obviously and directly—for Devonport. That has led to a vacuum in which all sorts of stories can flourish. My hon. Friend the Member for Plymouth, Devonport did mention the 57 per cent. increase in the revenue accounts, which suggests that Babcock is doing fairly well at the moment, and we hope that that continues long into the future.
	Talk about confidence being sapped from our community, and the death of the dockyard and the naval base—the two are often confused—by a thousand cuts, will continue until we have greater clarity. Such talk thrives on recent decisions such as the one to switch the forthcoming refit of HMS Campbeltown from Devonport, its base port, to Rosyth. Such decisions are taken as symptomatic. I know that HMS Albion, HMS Westminster and HMS Monmouth will keep the yard busy for the next three years, but fears continue to abound about the strategic role for our naval base and the yard in the future.
	Devonport is already of course home to the Navy's three amphibious ships, the helicopter carrier Ocean and assault ships Albion and Bulwark. We want to become an amphibious centre of excellence, and the defence estates development plan, published earlier this year, said that a case could be made for regionalisation of the Royal Marines in the south-west, with closer proximity to the amphibious shipping. That has been costed, but is presently unfunded. The long-planned but unfunded aspiration to co-locate landing craft units from RM Poole and RM Turnchapel to Devonport naval base remains on hold. I hope that we will see some forward movement on that in the near future.
	I am sure that my hon. Friend the Minister understands that the background is not only about uncertainty or complexity, because it is also about the stories of disregard of, and decline in, the Royal Navy that are rehashed so often by the Opposition and the media. Such stories ignore the changing strategic environment in which the Navy operates and fly in the face of decisions taken by this Government, who ordered the two largest aircraft carriers ever sailed by the Navy. This Government are continuing the modernisation of our amphibious shipping so that it is now stronger than it has been for many decades. This Government equipped our attack submarines with land-attack missiles and are building the Type 45 destroyers and the Astute class submarines— [ Interruption. ] Yes, the Government are building fewer Type 45 destroyers, but they cost £1 billion each. Those investments are not modest. Indeed, they are part of the biggest shipbuilding programme for one or more generations. That is not to say that there are no issues that need to be addressed. Of course sophisticated anti-submarine and air defence frigates and destroyers will inevitably be built in smaller numbers as they become more expensive, but the Royal Navy still requires sufficient escorts to carry out the numerous and often unsung duties that it undertakes worldwide every day.
	When the Minister announced the recent cancellation of the seventh and eighth Type 45 destroyers, he also talked about bringing forward work on the future surface combatant programme, which will succeed the Type 22 and Type 23 frigates, most of which are currently based at Devonport. He was not able to give any detail then, but I hope that it will begin to emerge soon.
	I look forward to working with our defence team to ensure that they take the right long-term decisions for our country, both through continuing to scrutinise their work on the Defence Committee and through lobbying to ensure a full and proper role for the defence sector, especially for the naval defence sector in Plymouth, Devonport, for years to come.

James Gray: It is a pleasure, of course, to follow the hon. Member for Plymouth, Sutton (Linda Gilroy), whose knowledge of these matters is encyclopaedic. I will seek to be as brief as I possibly can, because I know that several colleagues are keen to speak. I may curtail some of the more interesting things that I had to say in the interests of brevity.
	These debates, until a moment ago at least, are often notable for their sense of unanimity across the Chamber. We are all agreed about what a superb, professional and selfless job our armed services do. That unanimity was typified by the superb parade before the summer recess when 120 of the soldiers of 4 Mechanised Brigade, led by a guards band, marched into Parliament through the Carriage Gates. As chairman of the all-party Army group, I can say that we intend to repeat that experience. I hope that subsequent returning brigades will have similar parades. It was great to see all parties in the House, led by Mr. Speaker, welcoming the soldiers to the north door of Westminster Hall.
	I also welcome the Under-Secretary of State for Defence, the hon. Member for Grantham and Stamford (Mr. Davies), to his place on the Government Front Bench. I well remember the very powerful speeches that he made when he was shadow Defence Minister, speaking from this side of the Table, and the way in which he criticised the Government so powerfully and extensively. He said that their defence approaches were dreadful. We have researchers at this moment looking into those wonderful speeches, which will certainly come back to haunt him for all his time on the Front Bench. None the less, he will doubtless advance those arguments now within the Ministry of Defence, and so once again that is an example of unanimity.
	Parades are vital, and I look forward to one that will happen in Wootton Bassett, in my constituency, this Sunday. It is not a parade to welcome back soldiers from overseas, but a particularly interesting event. Wootton Bassett, in contrast with the fact that we have been hearing about, that only 71 per cent. of people support the armed services, is a unique town and its people have turned out in their hundreds, and in many occasions in their thousands, to welcome back the tragic number of coffins—I think the number is 147 so far—that are repatriated through RAF Lyneham. The mayor, the Royal British Legion and the townsfolk of Wootton Bassett turn out in their hundreds on every single occasion. I often go with them. As a mark of that particularly wonderful ceremony, RAF Lyneham has chosen to turn out to hold a parade not in honour of our servicemen but in honour of the town of Wootton Bassett, which has gone to such great lengths to respect our fallen. That is enormously important.
	In the short time available to me, there are a couple of issues regarding RAF Lyneham that I would particularly like to bring to the attention of the new ministerial team. First, RAF Lyneham is to close in 2012 and the Hercules fleet is to move to RAF Brize Norton. As I understand it, Project Belvedere in the Ministry of Defence is considering what to do with Lyneham after the Hercules fleet moves out. The project is looking into how to bring all the helicopter fleets together in one place, potentially at RAF Lyneham. I would be interested to hear from the Under-Secretary of State for Defence, the hon. Member for North Durham (Mr. Jones), when he winds up, to what degree Project Belvedere is alive, well, kicking and moving forward. There are reports that, because of the £2 billion shortage that the MOD is experiencing, the project has been shelved. If that is the case, I would very much like to know what plans the Minister has for RAF Lyneham.
	If the helicopters come to RAF Lyneham, they will broadly be welcomed by local people—I would certainly lead the welcome—but there would be concerns none the less, particularly about the noise. I would like an assurance from the MOD that it will enter into useful discussions with the local community about the way in which we can control the flying hours and the flying patterns of the helicopters to minimise the environmental damage that might result for local people.
	Another current issue with regard to RAF Lyneham is the inquest being conducted by David Masters, the Wiltshire coroner, into the tragic loss of Hercules XV179 in 2004 in Iraq. Initial evidence given to the inquest, which is happening as we speak, seems to indicate that had the Hercules fleet been fitted with foam suppressant in the wing tanks before now—it appears that reports were circulating in the MOD some years ago that suggested that that should happen—there might have been less likelihood of that appalling crash. I am certain that the Minister would not want to comment on an inquest that is happening at this moment, and I would not ask him to do so. Through the medium of this debate, however, I want to say to the excellent coroner, Mr. David Masters, that if he concludes that there were inadequacies within the Ministry of Defence, as he has done on previous occasions, he will lose no time at all in being robust and outspoken in commenting on those inadequacies, which have occurred under both parties. It is not a party matter—it is an MOD matter—and it is vitally important to RAF Lyneham.
	I pay tribute to the other defence institutions in North Wiltshire. We have 9 Supply Regiment at Hullavington, 10 Signals Regiment in the town of Corsham, where 2,500 people provide communications for all three services, and 21 Signals Regiment at Colerne. They make a huge contribution together with the other Army bases across Wiltshire—half the British Army is based in Wiltshire.
	We often hear two easy clichés about resources in these debates. The first is to stay that the resources that the armed forces, including the people in my constituency, have at their disposal are woefully inadequate. There are certainly inadequacies—we have heard about helicopters, Snatch Land Rovers not being replaced sufficiently quickly, and there are a variety of other shortages. Of course there are shortages, which have always occurred throughout the history of warfare. No general ever says, "I have got more than enough men and equipment. I am perfectly happy," and we would not expect them to do so.
	The second cliché, which is equally easy, was raised by the previous Prime Minister, who said that our troops will have whatever they need on the ground. That is demonstrably not the case, and it is a foolish remark that is too easy to say. Rather than the constant backwards and forwards between those two extremes, we should examine exactly what we are doing around the world.
	I pay tribute to the hon. Member for Newcastle upon Tyne, North (Mr. Henderson). During my brief sojourn on the Council of Europe and the Western European Union, which are in my view two entirely useless organisations, my time was enlivened by his contributions to the debates. His remarks in this afternoon's debate were precisely right. It is no good just talking about whether we have enough troops or whether we have the right equipment, because such debates can go on for ever. What we must do—I hope that an incoming Conservative Government will do this—is carefully examine precisely what it is that we are doing around the world and why we are doing it.
	We have not done that on Afghanistan, for example. We do not know whether the mission is counter-terrorism, counter-insurgency or counter-narcotics. We do not know whether we are setting up a Guildford look-alike western-style democracy or whether we are simply helping people—there was a fantastic operation to rebuild the Kajaki dam, for example. We do not know what we are doing in Afghanistan. It would be right for an incoming Conservative Government to conduct a fundamental strategic defence review firmly based on foreign policy. The last SDR was not particularly based on foreign policy, and I hope that Conservative Front Benchers will do that when they take on this onerous duty in one or two years' time. The hon. Member for Newcastle upon Tyne, North was right to say that debates such as this cannot simply be about troop numbers and equipment, and they should be much more fundamental.
	Finally, we are short of time in this afternoon's debate, which is regrettable. We have few enough defence debates, and the introduction of the topical debate earlier on a Thursday afternoon reduces that time even more. I also wonder whether the structure of these debates, which we have set up over the years, is the best possible. Given the way the world now is, defence in the UK, defence abroad and defence procurement are much more interrelated than they used to be. I wonder whether Ministers, the usual channels or whoever is responsible for such matters will have a little look at the structure of the debates.
	We should fundamentally examine not only the way in which our armed services work—they do a superb job with the resources available to them—but what we are asking them to do. When we come to power in two years' time, I hope that our SDR will do precisely that.

David Kidney: I am pleased for my hon. Friends the Members for North Durham (Mr. Jones), and for Grantham and Stamford (Mr. Davies), who have joined the ministerial team, and I wish them every success in their endeavours. In our previous defence debate, I spoke in glowing terms about the glorious day on which we held a joint ceremony in Stafford to mark the granting of the freedom of the borough to the 22 Signal Regiment and the Tactical Supply Wing. Today, contingents from both are deployed in Afghanistan. The residents of Stafford and I hold all those soldiers in our thoughts and wish them the safest of returns home at the end of their tours. The mayor of Stafford, the local newspaper and I are in the middle of an appeal; we set ourselves the target of ensuring that the public donates at least one care package to each and every one of those soldiers while they are away from us, to show that we are thinking of them and working for them, even though they are not with us.
	In the previous defence debate, I spoke about Operation Borona, which was mentioned recently, and the possibility of bringing up to 20,000 of our service personnel and their families home from Germany and basing them in this country. Over the next five years, it will be quite a job for us to find places to put those service personnel and their families, and to accommodate them comfortably. My short contribution to this debate will be about that task. Where shall we put them, how shall we accommodate them, and where will the money for the accommodation come from?
	As Members have said, the previous Conservative Government gave us one lesson: they showed us how not to arrange accommodation for our military personnel. As others have said, the Annington Homes deal was disastrous. I would like to add one more point to the criticisms made of the deal: the capital receipts of £1.6 billion were not reinvested in the Ministry of Defence, to be spent for military purposes; they went straight to the Treasury. We must be much smarter in future to ensure that when we dispose of surplus assets in our military, we reinvest the money in our military and do not hand it over to the Treasury for other purposes. I point out to Defence Ministers that when they argue those points with Treasury Ministers, I will be on their side.
	There are numerous ways in which we provide accommodation for our military personnel. The most obvious way is through direct provision by the Ministry of Defence. Project Slam is an example of that; it involves us paying either to renovate an unacceptable property or to build brand-new properties—single living accommodation—for military personnel. That direct provision will eat up about £5 billion of public resources over the next decade. Clearly, that is not enough to meet existing needs, never mind the needs of the extra personnel coming back from Germany, so we need to be smarter. There are private finance initiative contracts, and what we call prime contracts. They are an example of the Ministry of Defence taking that smarter approach. We need to look at the lessons to be learned from existing PFI contracts and prime contracts to see what more we can do along those lines.
	There are also schemes to enable and assist military personnel to buy their own homes. As for service personnel leaving the forces who hope to rely on social housing for their future accommodation, this year we at long last changed the law to ensure equality of treatment for service personnel and local residents in the places to which service personnel retire, in terms of local connection. That is very welcome.
	Once the Ministry of Defence has built or renovated a property, it must manage it efficiently. The two recent Select Committee reports on the subject, produced in 2007 and 2008, show that the Ministry has made a deplorable lack of progress as a manager of property, both in terms of successfully maintaining properties and carrying out repairs at the request of families and military personnel, and in terms of managing voids. Perhaps the new Ministers in the Department might wield a new broom and either sharpen up the Ministry's act, or take away its responsibility for the management of property.
	The question of where the military personnel from Germany should go brings us to an issue that has been mentioned at least twice in this debate: the future of super-garrisons. It was suggested in the last defence debate that the west midlands was a potential site for a super-garrison. As a west midlands Member of Parliament, I welcome that. Although the hon. Member for Canterbury (Mr. Brazier) seemed to suggest that a super-garrison would be a new base in the middle of nowhere, it could be a combination of estates and could be added to existing places. I welcome the idea of Stafford being part of the home of a west midlands super-garrison.
	We said earlier that we must be smart about contracts and the involvement of private partners in providing accommodation. How we raise money from assets and reinvest it in our estates leads me to suggest that, at Stafford at present, there may be opportunities for those things to be brought together. Stafford borough council, the local authority, is consulting on the local development framework for the area, so it will identify areas of land in Stafford for particular kinds of development; the Ministry of Defence, of course, owns a considerable amount of land in Stafford. It is certainly of interest to the Ministry how its land there is to be treated for planning purposes in future.
	I sincerely believe that with the right discussions, land owned by the Ministry of Defence in Stafford can be released for redevelopment and have permission for the most valuable kind of development, and therefore release the greatest capital receipts for the Ministry of Defence. If we then overcome the objections of the Treasury and are able to keep the money in Stafford, we will be able to build the accommodation, as part of a super-garrison, to house the people who come home from Germany with their families. I hope that that is a neat enough trick for the Ministers to want to thank me for my contribution to this debate.

Ann Winterton: I associate myself with the remarks made by the Government and Opposition Front Benchers at the outset about those who have given their lives in the service of this country and those who have been injured, many of them very seriously. In the same breath, I should like to mention the work of the services charities such as the Royal British Legion, the Soldiers, Sailors, Airmen and Families Association, or SSAFA, and others.
	I was tipped the wink the other day and looked at the Help for Heroes website. I hope that the House will forgive me this indulgence, but I should say that I was delighted to see on it a lovely photograph of our only granddaughter, Catherine, aged 10, at a fundraising event. It is good that the young and others are not only aware of the work of such organisations, but actually take part in such events.
	It has been accepted by successive Governments and generations of British people that defence policy is not limited merely to the physical defence of the shores of the United Kingdom, but extends to the source of anything that might threaten the long-term peace and security of these islands or of our allies. Our armed forces have long operated around the world and are still called on to do so to bring calm and stability to areas that could threaten our nation directly or indirectly. Although we should not take our eyes off the potential for future conventional warfare and the threat that that would undoubtedly bring, it is highly likely that we will continue to be engaged in counter-insurgency operations in the foreseeable future.
	I should like to pay warm tribute to the outgoing Secretary of State for Defence, the right hon. Member for Kilmarnock and Loudoun (Des Browne), who during his watch oversaw the greatest transformation that the UK has seen for a long time as far as equipment, health care, accommodation and the general well-being of our armed forces—particularly the Army—are concerned. He should also be given credit for changing the basis on which our military vehicles were designed and procured, initially against much opposition from within and without the Ministry of Defence; he had the courage to go for the Mastiff and, more recently, the Ridgeback vehicles. The final act was to sign off a £500 million order for protected vehicles, for which all those who serve in the military and their families and friends will be grateful; lives will undoubtedly be saved as a result.
	I welcome the two new Ministers and the new Secretary of State for Defence, the right hon. Member for Barrow and Furness (Mr. Hutton), to the Front Bench. I very much hope that we will hear him contribute to the next defence debate. I hope also that he can achieve in the field of aircraft provision what his predecessor did for vehicles. Having campaigned for the use of light aircraft for ground attack and surveillance, I recognise that Watchkeeper will be a tremendous addition to unmanned aerial vehicles when it comes into service in 2010.
	There should have been no shortage of helicopters for our troops. Off-the-shelf medium helicopters could have been readily purchased but, as always, the crunch point is crew availability, because it comes down to hours per machine usage. If two or three crews are available, our aircraft can operate round the clock if necessary, whereas flying hours are severely limited when only one crew is available. That point was made forcefully by my hon. Friends the Members for Bournemouth, East (Mr. Ellwood) and for Canterbury (Mr. Brazier), who also made an excellent point about volunteer reservists. It will not have escaped the notice of the House that the United States uses a tremendous number of pilot reservists in Afghanistan, and I cannot understand why we cannot train more in this country and think out of the box in order to help to provide the cover that is so desperately needed there.
	Afghanistan has been a tremendous proving ground for equipment—it finds every weakness—but hard-won experience there has resulted in very different, but impressively more effective armed forces. It has, thankfully, changed the concept of the future rapid effect system in the nick of time, but I trust that the Secretary of State will not allow slippage back to the mistaken concept of blast absorption for mine and improvised explosive device protection to the now established and proven concept of blast deflection.
	What has been proved to be highly successful in Iraq and in Afghanistan is the training of their respective national armies. The British Army mentoring teams have a tremendous track record of leadership on the ground, giving direction and training locals in the use of mutually compatible equipment. However, these newly established armies lack air power. That emphasises the need to use less sophisticated air craft in order that air power can be established in a similar way to the progress that has been established on the ground. Unless this simple "ownership" of defence expertise is acquired by these fledgling forces, the UK military will find itself overseas for ever, giving constant back-up and acting in a supporting role.
	In Afghanistan, one of the greatest fears is that reconstruction work may fail in its aims and that, after their military success, UK forces may be dragged into a long, impossible, deteriorating holding situation. There is the problem of a weak central Government holding back provincial government advancement and success, with far too many UK and European Union organisations initiating, and supposedly supervising, aid. The idea put forward earlier that the armed services might play an enhanced role in reconstruction should appropriate funds be diverted to them has considerable merit. After all, the Kajaki dam project could never have been achieved without the military and, although schools and health care are vitally important, infrastructure is essential for the creation of wealth in order to support welfare projects. Otherwise, Afghanistan, like other difficult areas of the world, will become dependent on aid. That would in turn create a breeding ground for corruption and insurgency. We run the danger of going back full circle to where we started, and by allowing instability to develop further in hot spots, we fail the interests and defence of the United Kingdom and its people.

Mark Pritchard: I would like to put on record my tribute to the former Secretary of State, the right hon. Member for Kilmarnock and Loudoun (Des Browne). He was professional, courteous and honourable in all my dealings with him, and I am sorry to see him go. At the same time, I congratulate the new Secretary of State and I welcome the two new Ministers to the Front Bench. I would like to put on record my salute to the courage and bravery of all those in our armed forces who lost their lives over the recess period in the conflicts in Iraq and Afghanistan. I pay tribute to the Royal Irish Regiment, which is returning to Shropshire, as the hon. Member for Telford (David Wright) reminded us, the Royal Military Police, who returned home some months ago, other constituents who serve in the Territorial Army, and reserves in other services and regular units.
	As my right hon. Friend the Member for North-East Hampshire (Mr. Arbuthnot) said, one of the best speeches that we have heard on defence in this place came from the hon. Member for Newcastle upon Tyne, North (Mr. Henderson) today. I was going to set out my thoughts on the global context, although I think that I will run out of time. One cannot have a debate about UK defence without looking at the global context, defence alliances, which the hon. Gentleman touched on, or defence equipment.
	On the question of defence equipment, one of the greatest foreign policy challenges before us is that of failed states, rogue states or states that are infiltrated by terrorist organisations and radical groups. One country is causing particular concern: I heard a foreign policy expert speak recently on Iran. I hope that Iran and President Ahmadinejad will review their position with regard to the International Atomic Energy Agency and the international community, and that they will allow monitors back in to examine the so-called civilian nuclear programme and the so-called civilian space programme so that the current impasse with that country can be dealt with diplomatically rather than in any other way.
	On how that situation may be dealt with, there are only two options if the diplomatic and peaceful route does not proceed as we all want it to. First, we have conventional intervention, which is quite unthinkable, whether it is possible or not—and who would be involved? Secondly, there is nuclear intervention, and of course, no one endorses or wants to see that. However, we have a difficulty from the point of view of geopolitical strategy and that of stability. We do not have the needed flexibility in our current defence equipment. Our military commanders do not currently have certain options available to them and in the future they might need to consider other means to deal with a threat.
	If we are unable to use the conventional or nuclear option, what other options are there if diplomacy fails? During the debate on Trident last year, I mentioned hypersonic mass technology. As the hon. Gentleman said, we need to look again at defence equipment and at whether it matches the threats faced by our country and the NATO alliance. I hope that the Government will work closely with the American Administration and the great state of Alabama, which are developing conventional intercontinental ballistic missiles. These missiles are non-nuclear, but they have a far bigger and more powerful punch than any conventional missiles at the moment. Tomahawk missiles and cruise missiles would not be effective enough to deal with the threats in some parts of the world today, which is why we need to ensure that Britain is in the vanguard of developing such weapons. They are not fully developed at the moment, but they could come on-stream in two or three years. They can strike at any target within two hours, launched either from a submarine or a land site. I hope that the Government will consider such technology, and that the new Ministers will take a fresh look at whether we have the weapons to deal with current threats. They would cost fewer lives and less money than sending in a conventional army, or the use of nuclear weapons, which is completely unacceptable in my view.
	Given the time, I will allow those on the Front Bench to conclude.

Crispin Blunt: Before Front Benchers are given that opportunity, let me try to make the four points that I wanted to raise. The first concerns the reshuffle. I share the view of my hon. Friend the Member for Congleton (Ann Winterton) on the merits of the outgoing Secretary of State. I regret his passing and I do not believe that the Prime Minister has done the Department a favour. The Government will hit the electoral buffers in 18 months and the entire Department is engaged in the process of getting a new Secretary of State up to speed. By all accounts from those whom I know who ran across him, the outgoing Secretary of State was respected and liked in the Department. The new Secretary of State is as talented as the previous one, and we now know that the previous Secretary of State shares the Prime Minister's warm appreciation, which his successor has on record. That brings me to the rest of the reshuffle.
	We now have 25 per cent. more Ministers. That means another ministerial salary and salaries for more ministerial staff. The Under-Secretary of State for Defence, the hon. Member for North Durham (Mr. Jones), shakes his head. Is someone among the Ministers not taking a salary? That would be interesting. However, the increase in Ministers requires the involvement of many civil servants in administration. We all enjoy seeing our old friends and colleagues get on and succeed in Government jobs and, in that sense, it is nice to see the hon. Gentleman taking up his new responsibilities. He has a long involvement in defence dating back to before his election to the House. I think that I first ran across him in 1993 in the Swan Hunter shipyard.
	I believe that the hon. Member for Plymouth, Devonport (Alison Seabeck) mentioned the possibility of huge savings in the naval budget, and it struck me that we were in interesting times. I had an exchange with the hon. Member for Newcastle upon Tyne, North (Mr. Henderson) about what happened to the budget in 1988. I envisage a particular role for the hon. Member for North Durham as a trusty of the new regime to ensure that defence is not squeezed in what will undoubtedly prove to be a fierce battle between Departments about priorities in the coming disaster that is overtaking Government finances because of the economic situation and the Government's management of it until now. That battle must be won. If the world experiences the economic conditions that everybody now expects, enormous instability is a likely consequence some years down the line. The crash of 1929 was followed by our being engulfed in the second world war and one can perceive the link between the events. Despite all the pressures on the Government's finances, now is not the time not to invest in the United Kingdom's security.
	On Afghanistan, my hon. Friend the Member for New Forest, East (Dr. Lewis) was slightly unfair on Brigadier Carleton-Smith. I have known him for a long time—since university—and I believe that he knew exactly what he was doing when he spoke to the press. I do not think that the press should be blamed for the interpretation placed on his remarks. My hon. Friend was correct to say that they lay precisely within the bounds of military orthodoxy but that there had been a change of emphasis, accompanied by the reported remarks of Sir Sherard Cowper-Coles from Afghanistan. It is important to review what is happening in Afghanistan and I believe that there has been an outbreak of public good sense from those two fantastic servants of the United Kingdom in their respective roles.

Julian Lewis: rose—

Crispin Blunt: If my hon. Friend will forgive me, I shall not give way because I have one more minute in which I want to make one more point, which concerns the Gurkhas.
	Everyone in the United Kingdom feels warmly towards and has a soft spot for the Gurkhas because of their contribution to this country. Many will have welcomed their court victory the other day, but I just offer a note of caution on that. That victory may turn out to be pyrrhic. We need to remember that the Gurkhas' contribution was based on their terms of service with the United Kingdom. They therefore produced soldiers for the United Kingdom who were adapted to a specific, rather more limited role than English or other British infantrymen would be used for, in the regiments of the Brigade of Gurkhas. Gurkhas of course came cheaply, too. Their conditions of service meant that they did not carry the same pension or other liabilities of other British servicemen.
	I see that the hon. Member for Stafford (Mr. Kidney) is still in his place. In the 1991 defence review, the Staffordshire Regiment and the Cheshire Regiment were going to be amalgamated, in order to keep a Gurkha battalion in the line of battle of the British Army.
	Gurkhas will now be remunerated on exactly the same basis as other line infantrymen. They will come with an overhead to sustain an organisation in Nepal, in order to keep them in place, as well as an additional overhead to the United Kingdom in the costs involved in their families having the right come here. I fear that the victory that the Gurkhas have won may be pyrrhic, when we look at all the costs and the alternatives.

Gerald Howarth: As is usual on these occasions, we have had an extremely well- informed debate, with some very interesting contributions. I agree with my hon. Friend the Member for North Wiltshire (Mr. Gray) that it is disappointing that the House has not had more opportunity to hear some learned contributions. It is also disappointing that the press do not take more interest in reporting what we discuss here, but we all know that they are much more interested in the trivialities of what goes on here than in much of the substance.
	Like my hon. Friends, I pay tribute to the former Secretary of State, the right hon. Member for Kilmarnock and Loudoun (Des Browne). He initially arrived with no knowledge of defence and with the impediment of being a human rights lawyer, but he learnt hugely in the post. We all found him most congenial to deal with and we are disappointed that he has gone. He learnt in the post, and he made many friends in the Ministry of Defence and among our armed forces, as he became more knowledgeable and understanding. However, the Prime Minister imposed upon him the impossible task of performing the Secretary of State's duties part time, having given him the duties of the Secretary of State for Scotland, too.
	The hon. Member for Halton (Derek Twigg) also served the House well, as well as veterans' interests. He did a good job in that area and the Government can claim to have achieved some success, not least in the creation of a veterans' badge, as the hon. Member for Telford (David Wright) said, which we have all had the opportunity to give to our constituents.
	I welcome the new Ministers, although I am perhaps not as charitable as my hon. Friend the Member for New Forest, East (Dr. Lewis). As my hon. Friend the Member for Reigate (Mr. Blunt) pointed out, there are now four Ministers on the Front Bench. That is a 33 per cent. increase, and I am sure that the armed forces would welcome a 33 per cent. increase from the Chancellor of the Exchequer, although that is unlikely at present.
	The reason why there are now four Ministers is that the Government have realised that they have been outdone by us. We have four spokesmen and they have had to match the formidable firepower from the Conservative Benches. The Government are going to need every bit of firepower that they have between now and the next general election, when we come storming back to victory.
	As has been pointed out, apart from the Minister for the Armed Forces, the rest of the ministerial team are rookies, leaving him, a 12-month server, as the longest-serving Minister. There are challenges that those on the Front Bench will have to contend with, not least the Secretary of State, who will have to do some explaining, given what he told the House in December 1997:
	"It is clear that the Royal Navy has borne the brunt of many of the reductions in defence spending in the past 15 to 20 years. That is a serious mistake."—[ Official Report, 3 December 1997; Vol. 302, c. 275.]
	We all look forward to seeing how he will justify the slashing of the Royal Navy's surface fleet, from the 32 frigates and destroyers in the SDR to the present 22. Apart from the huge increase in our commitments, what has changed to justify that reduction in the Royal Navy?
	The Under-Secretary of State for Defence, the hon. Member for North Durham (Mr. Jones) and I are old friends and sparring partners on the Defence Committee, and I look forward to his doing something for me. He very kindly gave me an Afghan hat when he came back from Afghanistan, which I have worn, although not publicly. When I came back from Tunisia earlier this year I gave him a red fez, on condition that he was to wear it at the next meeting of his constituency Labour party. I look forward to seeing a photograph of him so clothed.
	The hon. Gentleman has now signed up to the unenviable task of answering the innumerable criticisms of the Defence Committee, which is chaired by my right hon. Friend the Member for North-East Hampshire (Mr. Arbuthnot). He is going to have to explain them to the House and to the public or, alternatively—as has been suggested by my hon. Friend the Member for Reigate—fight jolly hard within the Department for the things that he fought for when he was a member of the Committee. The hon. Gentleman enjoys a reputation for having subjected MOD witnesses to severe dressings down, and they will no doubt be thrilled to have him as their Minister now. I can hear the orders for the Château Lafite being given in officers' messes across the land, and I am sure that he will get just as warm a welcome in the sergeants' messes. He needs to start eating some humble pie before he tucks in in the officers' mess.
	The Under-Secretary of State for Defence, the hon. Member for Grantham and Stamford (Mr. Davies), having ratted, cannot expect us all to be as charitable to him as my hon. Friend the Member for New Forest, East was. It is entirely true that our researchers are not even working overtime, because there is such a deep seam of his past quotes to mine. I shall content myself with producing only one of them. A few years ago, he said:
	"The defence of the country is no longer in the hands of people who care about defence; it is in the hands of the new Labour Treasury. There can be no less safe hands for the defence of this country than that."—[ Official Report, 13 April 2000; Vol. 348, c. 591.]
	I think that the hon. Member for Stafford (Mr. Kidney) almost agreed with that latter point.
	We have had a good debate today. In the time available to me, I cannot go through all the contributions that have been made, but I shall single out one or two.
	It is good to see that the hon. Member for Plymouth, Devonport (Alison Seabeck) has been unleashed from her Trappist vows and is now giving vent to freedom of expression, which, as a Whip, she would not have tolerated. She said that the Conservatives were not supportive of the United Kingdom defence industry, but that is not true. We are extremely supportive of it, and I refer her to my speech on defence procurement in the House on 19 June.
	The hon. Member for North Devon (Nick Harvey) referred to the budget black hole, and he was absolutely right. That is going to be a problem with which Ministers will have to contend. They are going to have to explain how £500 billion can be found for the banks, when a couple of billion pounds cannot be found for the hard-pressed defence forces of this country. The public certainly want to know the answer to that question.
	There is much mention to be made of the contribution of the hon. Member for Newcastle upon Tyne, North (Mr. Henderson). What he said was absolutely right. He participated in the strategic defence review negotiations, and the House will undoubtedly have enjoyed his mini-review today. We shall want to study it in more detail.
	My right hon. Friend the Member for North-East Hampshire, who does a marvellous job commanding the Defence Select Committee, referred to the report on recruitment and retention, and I want to refer briefly to it as well, if I have time. He also said that we need a strong defence industry and strong defence exports. I entirely agree with him about that.
	Next week, on 16 October, we shall celebrate the centenary of flight in this country. There will be a fly- past, which my right hon. Friend can watch, and I will be flying the De Havilland Canada 1—a Chipmunk sandwiched between a Hurricane and a Vulcan. That spectacle will be on view at Farnborough next Thursday, weather permitting. We will have the opportunity to demonstrate how Britain has made such a contribution to, and led the world in, the aviation business during the past century.
	The hon. Member for Telford and my hon. Friend the Member for The Wrekin (Mark Pritchard) drew our attention to the concerns about training in their constituencies. Both of them have been members of the armed forces parliamentary scheme, as, I think, has the hon. Member for Plymouth, Devonport. I think that that speaks volumes for the value of the AFPS.
	My hon. Friend the Member for Canterbury (Mr. Brazier) is an absolute expert on reserve forces, and he paid tribute to their role in his speech. He has also produced some excellent reports, which the House would do well to study. The hon. Member for Plymouth, Sutton (Linda Gilroy) said that when the First Sea Lord warns about cutbacks to the naval programme he needs to be heeded. The last one made the same cuts, and he got a peerage, so this one probably can as well.
	My hon. Friend the Member for North Wiltshire (Mr. Gray) referred to the repatriation of the fallen through his constituency. All of us will have been hugely impressed by the people of Wootton Bassett in his constituency, whom we have seen on television and who have given the fallen the dignity of a hero's return, for which the entire nation ought to be grateful.
	The debate clearly takes place against a background of the darkest possible economic conditions, the full fallout of which we must await and in turn assess in relation to future spending priorities, but we cannot allow those matters, however weighty, to distract us from attending to the needs of our armed forces.
	Much mention has been made of the need to look at the new geopolitical situation. For the past year, I have been warning that we ignore what Russia is doing at our peril. While I understand what my hon. Friend the Member for Congleton (Ann Winterton) said about the need to deal with the situation in Afghanistan—much of which task has been done, as she pointed out—it would nevertheless be foolish not to note how Russia is now behaving: invading Georgia, claiming the Arctic and rebuilding its military capability.
	I am sorry that the Minister was insulting about our military covenant commission. We have some distinguished people on it and it would be good for him to apologise, because Simon Weston, John Keegan and Rear Admiral Iain Henderson are not people to be trifled with.
	Much mention has also been made of Help for Heroes and other charities, which have done a fantastic job. They are much in tune with the public spirit, which is support for our armed forces. The high command has been slow to recognise the public support that exists for the armed forces.
	By the Government's own admission, the state of the armed forces is parlous and they have failed to resource the armed forces to meet the current international challenges. Those failings are fully annotated in the Ministry of Defence's own annual report and accounts, but the nation has every reason to take pride in the courage, loyalty and commitment of our armed forces, which continue to set the standards against which other nations are judged. They are supported by a defence industry that is striving to ensure that they have the very best equipment, preferably sourced from the UK, to discharge the responsibilities imposed on them by us, the politicians. Our servicemen and women, together with their families, deserve the best support that the country can give them.

Kevan Jones: I start by associating myself with the expressions of sympathy for those who have fallen over the summer and those who have been injured in the service of their country. I thank everyone for their kind words during the debate, although I am not sure how long they will last, and for the cards.

Simon Burns: It will be the only time.

Kevan Jones: As the hon. Gentleman says, it will be the only time. I also thank everyone for the kind letters that I have received, including one from a member of the Defence Committee, which said, "Your moving on is a little like toothache: you miss it when it's gone."
	I also pay tribute to my predecessor, my hon. Friend the Member for Halton (Derek Twigg), and his tremendous work on behalf of veterans, and to the former Secretary of State, my right hon. Friend the Member for Kilmarnock and Loudoun (Des Browne). I thank the members of the Defence Committee, where I had seven and a half wonderful years, and the Chairman and Vice-Chairman for the work that they have done. I also thank the staff and the special advisers for their hard work.
	Members will be reassured to know that I am now a fully trained-up member—I have just signed up this week—of the new Ministry of Defence poacher-turned-gamekeeper course. This has been an interesting experience and learning curve, but I must say that I have been welcomed and I acknowledge the enthusiasm and dedication of the staff and military personnel I have worked with in the last few days.
	If I do not cover all the subjects raised, I will write to any hon. Members who brought up specific points. The hon. Member for New Forest, East (Dr. Lewis) raised JPA—joint personnel administration. My predecessor commissioned a report on some of the problems and this week I met the Deputy Chief of the Defence Staff and the three principal personnel officers. I have actioned that report and asked them to ensure that it is on the agenda for my monthly meetings; rest assured that I will be on top of it.
	Mental health was raised, and members of the Select Committee know that it is an area in which I take great interest. I have had a meeting this week with the Surgeon General and Dr. Ian Palmer of the mental health medical assessment programme. I have asked for work to be commissioned on the issue to ensure that it is a top priority. I know that it is causing concern and I want to ensure that the armed forces get the best mental health care—not just while they are in service, but afterwards.
	The hon. Member for New Forest, East (Dr. Lewis) raised the issue of Brigadier Mark Carleton-Smith. I had the privilege of meeting the brigadier in July when I was in Afghanistan. I pay tribute to him and his men for their tremendous work on our behalf. The position is clear and not ambiguous: as the Prime Minister said on 12 December, we do not negotiate with the Taliban, but we will work with the Afghan Government in relation to those people who are prepared to renounce violence. As the right hon. Member for North-East Hampshire (Mr. Arbuthnot) knows, we sat down with some people who had done that when we were there. I do not think that the brigadier or the stabilisation team, whom we met in Lashkagar and are doing a tremendous job, would disagree with that approach. Anyone who tries to say that the military are doing everything should look at the stabilisation team working in Lashkagar, because it is a great joined-up effort.
	I pay tribute to my hon. Friends the Members for Plymouth, Devonport (Alison Seabeck) and for Plymouth, Sutton (Linda Gilroy) for their hard work on behalf of Devonport and the Devonport strategy group. I understand their frustration, but I reiterate the point made by my right hon. Friend the Minister for the Armed Forces in his letter: there is no equivocation about the Government's commitment to Devonport. With two such strong advocates, I am sure that I will get regular updates. The naval base review will deliver what is planned.
	The hon. Member for North Devon (Nick Harvey) covered a few issues, including the future rapid effect system—as the hon. Member for Congleton (Ann Winterton) knows, I am a FRES anorak, along with her, and follow it in detail. She rightly paid tribute to the operational requirements delivered in Afghanistan, and I have seen the protection given to our servicemen and women on the ground in both Afghanistan and Iraq. I pay tribute to the team who have got those urgent operational requirements into theatre.
	My hon. Friend the Member for Newcastle upon Tyne, North (Mr. Henderson) made a fantastic speech. I have known him a long time. He and I worked together, along with Lord Robertson, and the GMB trade union is obviously a good breeding ground for Defence Ministers. My hon. Friend takes a great interest in European affairs, and I agree with him that we cannot insulate ourselves from the rest of the world. We need to emphasise that.
	The right hon. Member for North-East Hampshire will be pleased to know that this week I met the Deputy Chief of the Defence Staff for personnel and three personnel officers and asked them to do some work on retention—not just in relation to pay, but to find out what else can be done. I received the right hon. Gentleman's letter about his trip to Israel. Not only will I respond to it, but I would like to speak to him about it. I understand his concerns about affordable housing. That issue is on my radar screen, and a piece of work has been commissioned this week.
	My hon. Friend the Member for Telford (David Wright) is a strong advocate for his constituency. I think that he is trying to get me to name a ship after him or Telford, which would be difficult. Perhaps he should follow the example of Durham county council, which is proudly associated with HMS Bulwark. He mentioned the success of the veterans' badge, of which 650,000 have been produced. They are valued and welcome in recognising the debt of honour to those men and women who have sacrificed their lives and worked on our behalf.
	My hon. Friend also mentioned the situation of those injured and killed on operations. On 10 June the Secretary of State announced a scroll and emblem for the next of kin of those who have lost their lives in action on our behalf. I thank and pay tribute to the  Daily Mirror for its campaign on that.
	With time short, I apologise to other Members whose contributions I will not be able to cover. I find this an exciting brief, and I will ensure that the voice of veterans, and of the ordinary man and woman who serve on our behalf is heard loudly in the Ministry of Defence.
	Let me also say, in the spirit of bipartisanship referred to by the hon. Member for New Forest, East, that I want to work with Members in all parts of the House to ensure that we secure not only the best possible conditions but the best possible recognition for our armed forces.
	 It being Six o'clock, the motion lapsed without Question put.

GIBRALTAR

Motion made, and Question proposed, That this House do now adjourn. —[Mr. Blizzard.]

Andrew Rosindell: I am very pleased to have an opportunity to address the House on the subject of Gibraltar, and I do so with great pride, both as an active member of the all-party parliamentary Gibraltar group and in my capacity as chairman of Conservative Friends of Gibraltar. Both those groups work to fortify the already strong relationship between the peoples and Governments of Gibraltar and the United Kingdom of Great Britain and Northern Ireland. I am proud to be strongly linked to Gibraltar as a result of many years of visiting the Rock and campaigning to support the rights, freedoms and self-determination of the great British Gibraltarian people, and I want to take this opportunity to champion a distinctive, welcoming and loyal British Overseas Territory.
	Located on the southernmost tip of the Iberian peninsula, Gibraltar is the gateway to the Mediterranean sea from the Atlantic ocean. The Rock overlooks the Straits of Gibraltar, which separate southern Europe from northern Africa. Small though it may be, consisting of an area of just under 6 square miles and with a population of around 28,000, Gibraltar nevertheless boasts a rich and varied culture and a blossoming economy, and is a fine example of an established, progressive and modern democracy.
	As Gibraltar is a British Overseas Territory, its Head of State is Her Majesty Queen Elizabeth II. The Queen is served by the Governor, currently His Excellency Lieutenant-General Sir Robert Fulton KBE, who is the representative of the Crown. The role of the Governor is largely ceremonial, but the United Kingdom still retains responsibility for important areas such as defence, foreign policy, international security and finance.
	In London, Gibraltar is represented by Albert Poggio OBE, who is the head of the Gibraltar Government Office and manages a team of dedicated staff in the Strand, looking after the interests of Gibraltar in the United Kingdom 365 days of the year. Albert does a magnificent job for Gibraltar and I pay tribute to him for doing so much to defend and promote it, especially during such politically difficult times. It is thanks to Albert Poggio that Gibraltar has so many friends here in Parliament, in all parts of the House.
	The Hon. Peter Caruana, QC, is the elected Chief Minister of Gibraltar, and has served the people of the Rock with great distinction since his election to office in 1996. The Hon. Joe Bossano, as Leader of the Opposition and a former Chief Minister, has also served the people of Gibraltar with immense determination. I pay tribute to both those gentlemen, and to all the Assembly Members and politicians of Gibraltar.
	Whatever political differences exist, one issue that unites everyone is their desire to remain British and to uphold the rights of the Gibraltarian people to determine their own destiny. I wholeheartedly support them in that. I earnestly hope that the Minister will take the opportunity to confirm categorically on behalf of Her Majesty's Government that in future they too will uphold the principle of self-determination for the people of Gibraltar, and that never again will the Government seek to impose a constitutional arrangement over the heads of the people as Mr. Blair's Government attempted to do in 2002 under the discredited joint sovereignty proposals.
	Indeed, it is a pity that the Minister for Europe, the right hon. Member for Don Valley (Caroline Flint), is not here to reply to the debate herself. After all, it was she who, as Parliamentary Private Secretary to the right hon. Member for Neath (Mr. Hain), was so enthusiastic in supporting what can only be described as a shameful attempt to deny the people of Gibraltar their democratic and human rights. It will never be forgotten that after Gibraltar's 300 years of loyalty to the Crown and to Britain, this Labour Government attempted to raise the Spanish flag above the Rock, entirely against the wishes of the people of Gibraltar themselves. It was a grubby episode that must never be repeated by this or any future British Government. Perhaps, in her new role, the Minister for Europe will find it within herself to apologise to the people of Gibraltar and make amends for the immense hurt that was caused at that time, and particularly to apologise for the role that she played in those shameful days.
	However, the people of Gibraltar are strong and will never be beaten, and today Gibraltar goes from strength to strength and remains steadfastly loyal to the Crown and to Britain. Indeed, the history of Gibraltar is rich in its links to Great Britain. Following its capture in 1704, Gibraltar was ceded in perpetuity to Britain in 1713 under the treaty of Utrecht. In 1830, Gibraltar became a Crown colony, strategic to British interests in the Mediterranean. During the two world wars of the 20th century, Gibraltar was used as a vital base for allied naval units. In world war two its citizens were evacuated and the territory turned into a fortress. Indeed, Gibraltar was central to ensuring the success of the allied landings in north Africa in the early 1940s and in the fight against fascism.
	Since coming under British influence, Gibraltar and its people have continually had to endure threats from Spain over its sovereignty, which culminated in the closure of the border in 1969. The people and Government of Gibraltar adapted quickly to avoid damage to the economy and benefited from increased diversification, a boom in tourism and increased military spending. Eventually, years later, in 1985, the border was reopened, although only after Mrs. Thatcher's insistence on that before Spain was allowed to join the European Community, but sadly Spanish aggression towards its neighbour continued.
	The issue of sovereignty features very strongly in the politics of Gibraltar. Although geographically the territory is much closer to Spain, the people of Gibraltar have fiercely defended their right to remain British. When visiting Gibraltar, the British influence is clear to see. Inhabitants of the territory use the Gibraltar pound, which is interchangeable with sterling. They can post letters in red pillar boxes, watch bobbies on the beat or go for a pint down the Lord Nelson or Pig and Whistle, and sitting in the Chief Minister's office, above Mr. Caruana's desk, hangs, of course, a portrait of Her Majesty the Queen.
	The border closure between Spain and Gibraltar in 1969 was triggered, in part, by the events of 1967. Britain had given Gibraltar more power to deal with its internal affairs, but Spain contested British sovereignty over the territory, claiming that the territory should pass to it. In an effort to reconcile that demand, a referendum was held on 10 September 1967 to determine the territory's future. Voters were asked whether they wished to pass under Spanish sovereignty or remain British, with institutions of self-government. The result was an overwhelming decision by the people of Gibraltar to remain under British rule and reject any suggestion of becoming a part of Spain.
	In 2002, another referendum took place, this time on the proposal for joint sovereignty put forward by the then Foreign Secretary, now Secretary of State for Justice. Once again, more than 98 per cent. of people voted against sharing sovereignty with Spain and for remaining British. The joint sovereignty proposals were a cynical move by the Government, putting the future of the territory up for negotiation in order to gain concessions from Madrid relating to the European Union. It was a shameful move that served only to fuel Spain's unfounded territorial claims. However, since the referendum, tripartite talks have taken place between representatives of the UK, Spain and Gibraltar to improve relations and work towards co-operation, without ceding anything to Madrid on the issue of sovereignty. Gibraltar today has a new constitution, with a settled and secure status as a self-governing British overseas territory.
	However, I believe that there remains an issue that must still be properly addressed: representation here in the British Parliament. Currently, the people of Gibraltar are permitted to vote in European elections as part of the south-west region of the United Kingdom, but have no democratic representation here in the House of Commons. Indeed, given devolution for Scotland, Wales and Northern Ireland, I see no reason why the people of Gibraltar could not, if they so desired, have their own elected Member of Parliament to speak on their behalf on issues affecting the territory, and on policies and laws decided here in Westminster that directly affect the people of Gibraltar. In the interests of democracy, this issue must surely be addressed one day by Her Majesty's Government.
	For Gibraltar, tourism is a significant industry and is an important foundation of its service-based economy. The economic success of Gibraltar is most notable. It has a thriving economy, which is dominated not solely by tourism but also by financial services and shipping. Since 1978 the economy has adapted and changed with the times, having to deal with the closure of the Royal Navy dockyard and the reopening of the border with Spain. The economy of Gibraltar has proved to be highly resilient and able to adapt better than that of most other countries around the world—a very impressive achievement for a territory of its size. That meant that in 2007, Gibraltar's economy was growing at an impressive rate of 6 per cent. per annum, which is very high in comparison with its European counterparts.
	Gibraltar's economic affluence is matched only by its cultural and social richness. Gibraltarians have varied roots, including English, Spanish, Italian, Maltese and Portuguese, and all of them feel a strong cultural identity tied to Britain. The majority of inhabitants are Roman Catholic or Church of England, but there are also small Jewish, Muslim and Hindu populations, among others. Many citizens are bilingual, speaking both English and Spanish. Although the people of Gibraltar have many diverse origins, the British influence remains strong and clear to see. English is the sole official language of Gibraltar and is the language of choice in government, commerce and education. Students in Gibraltar who wish to progress into further education do so by attending British universities.
	Many tourists are drawn to Gibraltar because of its rich wildlife and breathtaking scenery, which I could not help but observe on my recent visit only last month. As I am sure hon. Members are aware, I have a strong passion for wildlife and conservation. More than 500 species of flowering plants grow in the territory, and olive and palm trees are common. Dolphins and whales are frequently seen in the bay, and Gibraltar boasts a large nature reserve that is home to more than 200 Barbary apes—the only wild monkeys that can still be found in Europe today. It is said that should the monkeys ever leave, so will the British. Apparently, Sir Winston Churchill took this superstition so seriously that he arranged for a fresh consignment of monkeys to be imported to Gibraltar from Africa when he heard that numbers had been depleted during world war two.
	Unfortunately for this particular Member of Parliament, the monkeys of Gibraltar do not always extend the same warm welcome that Gibraltarians usually offer their guests. Despite my concern for the well-being of the Barbary apes, in my capacity as shadow Minister for animal welfare, I encountered last month one mother ape that decided to sink her teeth into my left shoulder. I am sure that the Minister has read reports of this in  The Sun, the Daily Mirror and every diary column in this country.
	During my visit to Gibraltar, I was honoured earlier last month to join Gibraltar's national day celebrations, on 10 September. The day is a public holiday, when the people of Gibraltar dress in the national colours of red and white. They gather to celebrate the result of the 1967 referendum, when the people of Gibraltar decided to remain British. The streets of the territory are always strewn with both the Union Flag and the red and white flag of Gibraltar, and most years the celebrations culminate in the release of thousands of red and white balloons to represent the people of Gibraltar. The event is a magnificent celebration, as Gibraltarians demonstrate their love of their homeland and their pride in being British.
	We in London sometimes forget to give proper recognition to Gibraltar and indeed to all the British overseas territories—it is recognition that they so richly deserve. I once again urge Her Majesty's Government to give Gibraltar and the other British overseas territories the right to lay a wreath, every year, on Remembrance Sunday at the Cenotaph in Whitehall. Such a move would acknowledge the valuable contribution of the people of Gibraltar to the defence of the realm over 300 years and particularly to the second world war effort, and would truly be a fitting way to remember and commemorate all those who laid down their lives for Queen—or King—and country. I hope that the Minister will tell the House whether the Government will agree to the proposal in time for Remembrance Sunday on 9 November.
	Another great British custom, the trooping of the colour to mark the Queen's official birthday celebrations, should also recognise Gibraltar and the British overseas territories. I ask the Minister to explain why the flag of Gibraltar and those of all Her Majesty's overseas territories and Crown dependencies are not flown in Horse Guards parade for that great state occasion. It would be so easy to fly them, and that would mean so much to these loyal subjects, both in Gibraltar and around the world. The time has come to allow Gibraltar to fly its flag at this most British of occasions and to participate in all British traditions here in the United Kingdom. Change is needed, and although those gestures might be small, they would send a positive signal to the people of the overseas territories and a message of pride, patriotism and unity to the rest of the world.
	The United Kingdom and Gibraltar share an unshakeable bond. Our relationship is one of deeply held shared culture, historic traditions and a history that has bound us together over more than three centuries. We need to build upon the foundations of that relationship wherever possible. As long as the people of Gibraltar continue to show their desire to remain a part of our great British family, as they have done on so many occasions and continue to do today, we in this House of Commons have a duty to ensure that the freedom and self-determination of the people of Gibraltar are defended, cherished and upheld. Long may British Gibraltar remain a proud territory of the Crown, and may the Union flag continue to fly above the Rock, this day and for centuries to come.

Bill Rammell: I congratulate the hon. Member for Romford (Andrew Rosindell) on securing this debate. His long-standing interest in Gibraltar is well known, and it has been reaffirmed by his recent visit last month to the Gibraltar day celebrations. I am grateful to him for giving me this opportunity, so soon after taking up my post, to underline this Government's excellent working relationship with the Government of Gibraltar and to reaffirm this Government's commitment to the people of Gibraltar.
	My right hon. Friend the Minister for Europe regrets that, as a result of overseas commitments, she is unable to attend this debate, although she will be following it closely. The hon. Gentleman has made it very clear that there is huge affection between the peoples of Gibraltar and Britain, stretching back over 300 years. He alluded to the fact that Gibraltar is full of reminders of that relationship—in its historic fortifications and British military presence. The high level of interest in this House in Gibraltar issues is also an illustration of that close and continuing relationship.
	But the relationship is about much more than history. Gibraltar, as the hon. Gentleman said, is a vibrant modern territory. The constitution approved by the people of Gibraltar in 2006 provides for a modern non-colonial relationship with the United Kingdom. Gibraltar's economy is doing well, benefiting from being within the European Union and from a more predictable relationship with Spain, underpinned by the trilateral process. That trilateral process has provided a valuable forum for dialogue between the United Kingdom, Gibraltar and Spain. It addresses practical points and solutions to issues that affect the daily lives of those living in Gibraltar and, indeed, the whole region.
	The UK Government's position on sovereignty is clear, and forms the important overall context in which to view the points raised by the hon. Gentleman. In an otherwise excellent speech, the comments that he made about the actions of this Government and the reference he made to raising the Spanish flag above the Rock are without foundation. The British Government have never sought to impose a constitutional arrangement on Gibraltar. I state clearly for the record that the UK will never enter into arrangements under which the people of Gibraltar would pass under the sovereignty of another state against their freely and democratically expressed wishes. Furthermore, the UK will not enter into a process of sovereignty negotiations with which Gibraltar is not content. That could not be clearer. The Government stand by that public commitment to Gibraltar, which is reflected and enshrined in the 2006 constitution and its accompanying dispatch.
	As I mentioned earlier, the trilateral forum of dialogue on Gibraltar has been a significant and welcome development since it was established in December 2004 at Chevening. The 2006 Cordoba agreements resulted in a historic package of measures on improved border flows and telecommunications, enhanced use of Gibraltar airport and the settlement of a long-running pension dispute. That has made the lives of citizens in Gibraltar immeasurably better.
	My right hon. Friend the Foreign Secretary hosted the second ministerial level meeting of the trilateral forum in London in July. The Foreign Secretary, the Chief Minister of Gibraltar, Peter Caruana, and the Spanish Foreign Minister, Miguel Angel Moratinos, agreed on six new areas of co-operation and a timetable for taking that further co-operation forward. That is very much to be welcomed. The agreed future areas of co-operation cover a wide range of issues relevant to the everyday lives of people in Gibraltar and the surrounding area, including environment, education, financial services, maritime issues and judicial co-operation. The trilateral forum is an ongoing process with great potential and a far-reaching future agenda. However, while the agenda is open, I wish to make it clear that sovereignty has never been discussed in the trilateral forum.
	The Government understand the wish of representatives of Gibraltar, and indeed the other overseas territories, to participate in the annual national ceremony of remembrance at the Cenotaph. Ministers have no objection to that in principle. However, there are significant logistical constraints on introducing changes to the ceremony. Any proposals for change need to take account of the extremely limited scope around the Cenotaph for additional participants, and the views of the royal household also need to be sought before any significant changes to the existing ceremony can be introduced. Therefore, the Government are working with Gibraltar's representative in London and the other overseas territories' representatives to consider the issue further.
	Like the rest of the overseas territories, Gibraltar does not have political representation in the Westminster Parliament as constitutionally it does not form part of the United Kingdom. Indeed, it is a separate jurisdiction. The people of Gibraltar are able to express their views to their locally elected representatives, just as people in the UK can do to their Members of Parliament. The interests of Gibraltar's voters are served by the Gibraltar Parliament and underpinned by the 2006 constitution. The people of Gibraltar are also able to raise their concerns with the Governor, and have the right to petition the Queen or the Secretary of State directly if they wish. The small size of Gibraltar means that people tend to have a much closer relationship with their elected representatives than people in the UK generally have with theirs, and can therefore easily make their views known. Gibraltar's voters are also entitled, as the hon. Gentleman is aware, to vote in European parliamentary elections. Their votes contribute to the election of the MEP representing the south-west region—the constituency is called the South West of England and Gibraltar.
	The 2006 constitution provides for a modern and mature relationship between Gibraltar and the UK. Although it gives Gibraltar much greater control over its internal affairs, it does not in any way diminish British sovereignty over Gibraltar and the UK retains full international responsibility for Gibraltar, including for Gibraltar's external relations and defence. The UK is the member state responsible for Gibraltar in the European Union.
	The people of Gibraltar exercised their right to self-determination in line with the treaty of Utrecht when they approved the constitution by referendum in November 2006. That is an important point to make to some of the international critics of the constitutional settlement as regards Gibraltar. The fundamental issue is the right to self-determination, which is absolutely in accord with the principles of the United Nations.
	The hon. Gentleman also referred to educational issues and the fact that if students from Gibraltar progress to further and higher education, they tend to attend universities in the UK. I had the opportunity of moving from the Foreign Office, where I had been responsible for the overseas territories, to become the Minister of State responsible for higher education. That informed my perspective on these issues, and one change that I was pleased to be able to agree was the right for students from the overseas territories who came to study in the UK to be granted home fee status. That has benefited students in Gibraltar and has been well received.
	Let me return to the hon. Gentleman's point about the trooping of the colour. He has asked about the flags at the trooping of the colour, but only flags of Commonwealth countries are flown in Horse Guards road during the trooping of the colour. The overseas territories, including Gibraltar, are not member states of the Commonwealth although they are associated with it. As a consequence—this is a settled position—their flags are not flown.
	I am also grateful to the hon. Gentleman for highlighting the diversity and success of Gibraltar's economy, which is the responsibility of the Government of Gibraltar. I agree that Gibraltar has prospered recently, benefiting from diversification and the opportunities provided by its being within the European Union. In recent years, robust financial regulation and a well-run maritime sector have also contributed to that growth. No territory is immune from the impact of the global economic situation, but I believe that Gibraltar has positioned itself very well. We hope that the trilateral process will contribute to an increased economic partnership between Gibraltar and the surrounding area.
	I want to thank the hon. Gentleman for his colourful description of the celebrations during his recent visit to Gibraltar. I hope that he has recovered from his close encounter with one of Gibraltar's Barbary apes. I understand that the ape is also expected to make a full recovery—I am sure that the House will be reassured by that fact.
	In conclusion, I—along with my right hon. Friend the Foreign Secretary and my right hon. Friend the Minister for Europe—want to echo the hon. Gentleman's appreciation of the work of the Governor, Sir Robert Fulton; the Chief Minister, Peter Caruana; Gibraltar's representative in London, Mr. Albert Poggio; and Members of the Gibraltar Parliament. I thank, too, my fellow MPs who are members of the all-party group on Gibraltar and all those who have worked throughout the House in support of the interests of Gibraltar.
	Gibraltar and the UK share a great bond. The UK Government fully intend to continue our excellent working relationship with the Government of Gibraltar and to stand fundamentally by our commitment to the people of Gibraltar.
	 Question put and agreed to.
	 Adjourned accordingly at twenty-nine minutes past Six o'clock.